NEVERENDING ♾️ The NEVERENDING Political Discussion Thread

[Whose Yur Planner]

A One thing that has been noticed in that deficit commission report thing was no mention of Obamacare™ and many other entitlements. IMHO, just that health care disaster alone may well completely collapse the Dollar.

:-@

AND, don't get me going on how Mr. Clueless (AKA BHO) is mishandling all of this on the Worldwide stage....

:-@ :-@ :-@

Mike

Ah yes, everything that is wrong with America can be traced back to Obama and the Democrats. Let's not mention the unfunded tax cuts, TARP, which was started by Bush, the economy that tanked, etc, etc, etc. As for mishandling the world stage, were to I start with Bush........

 

[Hink]

One thing that has been noticed in that deficit commission report thing was no mention of Obamacare™ and many other entitlements. IMHO, just that health care disaster alone may well completely collapse the Dollar.

So what are these "other entitlements"? I believe that the health reform was left out because it has been slated to be revenue neutral. You can argue with this, but the report touches on other health related issues like the Doc fix, and health spending. Social Security, medicare, and medicaid are mentioned extensively within the report. What other entitlements are you talking about? Did you read the document? http://big.assets.huffingtonpost.com/CoChairDraft.pdf

It strongly attacks entitlements. It takes a hard look at all spending the government does and even reduces tax rates (albeit with reduction of tax loopholes). I would have guessed you would have been mad at the defense budget cuts or cuts in Ag subsidies. Instead you focus on something that isn't even in the report?

 

[zman]

@ the Deficit Commission and Obamacare

I think that the middle class took enough of a rod up the ass on the other points of the plan that Obamacare didn't need to be mentioned.

 

[illinoisplanner]

Ah yes, everything that is wrong with America can be traced back to Obama and the Democrats. Let's not mention the unfunded tax cuts, TARP, which was started by Bush, the economy that tanked, etc, etc, etc. As for mishandling the world stage, were to I start with Bush........

Well actually, TARP and the economy tanking happened while Democrats were in control of Congress and Bush couldn't really do much accept go along with it. And actually TARP didn't end up costing that much, since it was a guarantee if the banks failed, but most of them didn't end up needing the money, so TARP actually only cost about $50B instead of $700B.

What is a complete waste of money though is Obama's stimulus which actually does cost $700B and has failed to stimulate the economy, along with the trillion-dollar healthcare law. That's $1.7 trillion dollars of unnecessary spending right there.

 

[kalimotxo]

Well actually, TARP and the economy tanking happened while Democrats were in control of Congress and Bush couldn't really do much accept go along with it. And actually TARP didn't end up costing that much, since it was a guarantee if the banks failed, but most of them didn't end up needing the money, so TARP actually only cost about $50B instead of $700B.

What is a complete waste of money though is Obama's stimulus which actually does cost $700B and has failed to stimulate the economy, along with the trillion-dollar healthcare law. That's $1.7 trillion dollars of unnecessary spending right there.

TARP was a crappy but pretty necessary measure to keep the economy from tanking. To say that ARRA failed to "stimulate the economy" is pretty glib. There's significant recognition that but for the stimulus the unemployment rate would be significantly higher than it is right now. I don't buy the argument that it did nothing because Keynesian policies can work if done correctly; however, it should have been significantly larger considering the scope of problems we were looking at. What angers me most about the whole ARRA thing is the number of Republican governors and congresspeople that were out there undermining the bill in public all the while jockeying to direct stimulus funds to their own districts. If it was such a useless pile of money, they probably should have kept their hands out of the pot.

As for the cost of health care, it had a big upfront price tag. But much like TARP it is expected to pay for itself within 10 years... something the non-partisan CBO determined independently. I don't know why you guys keep repeating the trillion dollar price tag as it's demonstrably false if you look at the long term.

I can't wait to see how the Republicans on the Deficit Commission respond to the numbers. As Hink pointed out, it targets a number of entitlements... everything from Medicare to the mortgage interest deduction. Of course, those entitlements benefit major Republican constituencies (e.g. increasingly the AARP demographic, the real estate industry, homebuilders assn, etc). Methinks some "deficit hawks" may be called on their bluff this time around. The resulting report is going to be watered-down pablum that does absolutely nothing to rein in federal spending because no one wants to face the political reality of substantially reducing popular payouts and subsidies.

 

[illinoisplanner]

TARP was a crappy but pretty necessary measure to keep the economy from tanking. To say that ARRA failed to "stimulate the economy" is pretty glib. There's significant recognition that but for the stimulus the unemployment rate would be significantly higher than it is right now. I don't buy the argument that it did nothing because Keynesian policies can work if done correctly; however, it should have been significantly larger considering the scope of problems we were looking at. What angers me most about the whole ARRA thing is the number of Republican governors and congresspeople that were out there undermining the bill in public all the while jockeying to direct stimulus funds to their own districts. If it was such a useless pile of money, they probably should have kept their hands out of the pot.

As for the cost of health care, it had a big upfront price tag. But much like TARP it is expected to pay for itself within 10 years... something the non-partisan CBO determined independently. I don't know why you guys keep repeating the trillion dollar price tag as it's demonstrably false if you look at the long term.

I can't wait to see how the Republicans on the Deficit Commission respond to the numbers. As Hink pointed out, it targets a number of entitlements... everything from Medicare to the mortgage interest deduction. Of course, those entitlements benefit major Republican constituencies (e.g. increasingly the AARP demographic, the real estate industry, homebuilders assn, etc). Methinks some "deficit hawks" may be called on their bluff this time around. The resulting report is going to be watered-down pablum that does absolutely nothing to rein in federal spending because no one wants to face the political reality of substantially reducing popular payouts and subsidies.

I don't object to stimulating the economy or improving the healthcare system. I just think that the bills as they are are too hastily thrown together and too much money is wasted (i.e. all the expensive "This Project Funded by the American Recovery and Reinvestment Act" signs). I understand the need to get bills passed in a timely fashion, but I just wish that more care was taken to reduce costs, better prioritize projects, and create real solutions to problems rather than just taking money off the money tree and throwing it at the problems.

As for the deficit, it is going to be interesting. I'm sure there may be some internal battles in the Republican Party over whether to reduce funding of popular programs (which I'm sure some of the old-school politicians are going to be against and that some of the newcomers might be in favor of).

 

[CJC]

Well, seeing as there is now almost no demand for USA Treasuries on Worldwide markets and a fast increasing level of talk in international monetary circles of going back to a Worldwide gold standard....

???

Record low yields on the past few auctions equals "almost no demand" how? Isn't it exactly the opposite? Record low yields = record demand

I'm very interested to see a link from any reputable source talking about talk of returning to a worldwide gold standard :lmao: Even talk from any individual country would be shocking, so I'd love to see that.

There is still soooooo much deflationary pressure from falling asset prices that we're years and years away from inflation of any significance unless the Fed starts printing several times the amount they are now (which is desperately needed, IMO). A few trillion in increased federal debt doesn't outweigh $10 trillion+ in asset price declines. Those figures are not exactly comparable and don't need to be one-to-one, but the point stands - there is ZERO inflationary pressure at the moment and for the foreseeable future, and that's easily backed up by treasury prices.

 

[btrage]

I love this thread, because it shows how the Fox News types have brainwashed so many people, including some of our regular posters.

And honestly, no one should expect "Mike" to back up the truths that his post(s) espouses. That's pretty much par for the course.

 

[illinoisplanner]

I too love this thread because it shows how the NPR/MSNBC types have brainwashed so many people, including some of our regular posters.

 

[Hink]

I too love this thread because it shows how the NPR/MSNBC types have brainwashed so many people, including some of our regular posters.

We have been through this already... NPR doesn't brainwash anyone... it lulls them to sleep.... sheesh...

 

[illinoisplanner]

We have been through this already... NPR doesn't brainwash anyone... it lulls them to sleep.... sheesh...

Ha. My point was simply to say it's kind of snarky and short-sighted to claim that someone is "brainwashed" by a certain news outlet when everybody gets their information from varying news sources and that if the term "brainwashing" is applied to one network, then I think it's only fair to apply it to all.

 

[mgk920]

If demand for USA Treasuries was so good, then why is the Federal Reserve the only entity that seems to be buying them up?

^o)

Mike

 

[CJC]

The Fed only started their current process (the much hyped $600 billion to be bought by next spring) of buying treasuries this past week ^o)

Are you only referring to the three auctions of $72 billion worth of treasuries this week? The auctions that drew more than $250 billion in total bids (a bid-to-cover ratio of well over 3 - many auctions in the 90's and early 00's had bid-to-cover ratios of under 1.5)?

 

[mgk920]

If things are going so well in the market for USA Treasuries, then why is the Fed even interested in buying them? Something doesn't smell right here.

Mike

 

[CJC]

They're buying treasuries in an attempt to create some much-needed inflation. The Fed doesn't publicly release an inflation target, but we've been far below the "whisper number" of 2% for quite some time.

You can disagree with whether or not that is something that they should do, but there is no evidence for a "lack of demand" for US treasuries. Demand is still far above historical norms, in large part because of the lack of other good things to sock money away in. I'll be cheering the moment that we do see a long-term drop in demand for treasuries - as that will likely mean that something major has happened (likely a pickup in the economy in the US, China dropping the dollar peg, or some measure of certainty regarding European debt levels).

High demand for US Treasuries isn't really a good thing, IMO, as it means other problems still exist. There are some other ways to stimulate the economy that I'd prefer be taken (encourage more repatriation of corporate profits, discourage corporate profit-holding through reform of the tax code, probably eliminate the corporate income tax, etc), but encouraging some mild inflation seems about the only thing possible politically. We've got to figure out some way to get the several trillion dollars sitting on corporate books moving.

 

[imaplanner]

Why haven't the republicans fixed everything yet?

 

[Planit]

imaplanner - Because he doesn't have healthcare insurance yet!!!

Entitlement, Ignorance, Hypocrisy and Newly Elected!

http://www.politico.com/news/stories/1110/45181.html

 

[illinoisplanner]

Why haven't the republicans fixed everything yet?

Well, technically, the new Republican-controlled House won't take their seats until January 2011. And even then, Democrats will still control the Senate and the Presidency. The real question to start asking in January is "why haven't the Republicans and Democrats worked together to fix things yet?".

 

[wahday]

The real question to start asking in January is "why haven't the Republicans and Democrats worked together to fix things yet?".

I've already been asking that for 4 years. Any reason things should be different now?

 

[illinoisplanner]

I've already been asking that for 4 years. Any reason things should be different now?

Well, because for the past four years, the Democrats controlled both houses and for the past two years, they've controlled the Presidency as well. So they could simply ignore what the Republicans had to say and railroaded through whatever they wanted because they had the votes to pursue their own agenda without the need to seek Republican input. Now that one party is in control of one house and one in control of the other, they have no choice but to work together if they want to get things done.

 

[imaplanner]

Well, technically, the new Republican-controlled House won't take their seats until January 2011. And even then, Democrats will still control the Senate and the Presidency. The real question to start asking in January is "why haven't the Republicans and Democrats worked together to fix things yet?".

Obama was supposedly a failure because he didnt fix everything by February 2009. So I am demanding the same of the republican controlled house.

. So they could simply ignore what the Republicans had to say .

What did they have to say? Other than "death panels!" "socialism!" and "Kenyan!".

 

[ofos]

Obama was supposedly a failure because he didnt fix everything by February 2009. So I am demanding the same of the republican controlled house.

You're demanding that Republicans not fix everything by February 2011?

 

[imaplanner]

You're demanding that Republicans not fix everything by February 2011?

Possibly. I'm not really sure. But I sure am angry about it! :-@

 

[wahday]

Well, because for the past four years, the Democrats controlled both houses and for the past two years, they've controlled the Presidency as well. So they could simply ignore what the Republicans had to say and railroaded through whatever they wanted because they had the votes to pursue their own agenda without the need to seek Republican input. Now that one party is in control of one house and one in control of the other, they have no choice but to work together if they want to get things done.

My take, which is probably pretty characteristic of the progressive status quo, is that the Republicans in the last 4 years simply positioned themselves as obstructionists with little more to their agenda (and stated as so by several of them) than stonewalling the President and preventing anything from happening. And this at a time when SO MUCH needs to happen. This recession isn't going to go away by itself, afterall.

Anyway, I saw very very little in the way of Republicans coming to the table with alternative ideas or a willingness to work as partners on these major issues and that was my point in my original posting. Instead, they have tried to block or delay most everything (including nominees) and then when things go to hell (in part because government has not been nimble enough to respond more quickly, gummed up as they are with obstructionists and not constructive dialogue) to put all the blame on the Dems and the President. Which all made me want to ask - so what were your ideas? But there weren't many so far as I could see.

So, I will be curious to see if any workable proposals are put forth here or if they will play the game of trying to stonewall more in the hope that they can increase gains in 2012. Which would be really really sad since there is so much business to take care of. Plus, I think that will likely backfire on them.

We're in a heck of a mess here, so those boys and girls up on the hill better get down to some serious cooperation or we're all going down the crapper together...

 

[illinoisplanner]

Obama was supposedly a failure because he didnt fix everything by February 2009. So I am demanding the same of the republican controlled house.

Well, I agree it's silly for people to have expected him to fix things by February 2009. I expected things to suck for most of 2009, but by the time 2010 came around, I expected more results, and frankly we haven't really seen much. Obama had an advantage though in that he could have his entire agenda passed since his party was in control of Congress. Since Republicans will only control the House and not the Senate or the Presidency, they can't get their agenda approved as easily as Obama could have.

What did they have to say? Other than "death panels!" "socialism!" and "Kenyan!".

What did they have to say? Well first of all, they had an alternative healthcare plan, H.R. 3400, that Pelosi let remain in committees for ever, while she expedited the Democrats' healthcare plan and without including any of the Republican alternatives, she went ahead and railroaded through where it passed narrowly, instead of being the bipartisan bill it should have been. Additionally, instead of the $787 billion pork-laden stimulus, the Republicans proposed an alternative stimulus that was mostly tangible tax cuts in addition to aid for the unemployed.

In response to wahday: As pointed out, Republicans did have alternative plans, but instead, they were shot down by Nancy Pelosi who would not allow Republicans to have any input on anything. It's that my-way-or-the-highway attitude of the Speaker that prevented any bipartisan work in the last Congress. So, what do you do in that situation where you're not welcome at the table? The only thing you can do, which is try to block or vote down the Democrats' bills and then try and beat them in the next election. And then when elected, not make the same mistakes they did. This can be done by listening to the American people and allowing the other side to weigh in, which are things that the Democrats did not do a very good job of last Congress.

 

[Whose Yur Planner]

What did they have to say? Well first of all, they had an alternative healthcare plan, H.R. 3400, that Pelosi let remain in committees for ever, while she expedited the Democrats' healthcare plan and without including any of the Republican alternatives, she went ahead and railroaded through where it passed narrowly, instead of being the bipartisan bill it should have been. Additionally, instead of the $787 billion pork-laden stimulus, the Republicans proposed an alternative stimulus that was mostly tangible tax cuts in addition to aid for the unemployed.

In response to wahday: As pointed out, Republicans did have alternative plans, but instead, they were shot down by Nancy Pelosi who would not allow Republicans to have any input on anything. It's that my-way-or-the-highway attitude of the Speaker that prevented any bipartisan work in the last Congress. So, what do you do in that situation where you're not welcome at the table? The only thing you can do, which is try to block or vote down the Democrats' bills and then try and beat them in the next election. And then when elected, not make the same mistakes they did. This can be done by listening to the American people and allowing the other side to weigh in, which are things that the Democrats did not do a very good job of last Congress.

I'm calling bull on this one ip. The only thing the R's had was same of the old tax cuts for wealthy bull that hadn't worked before. The R's showed zero interest in working together. They had fake, meaningless proposals that they knew wouldn't go anywhere. It's was meaningless pandering to the people who own them and run the party.

The R's did not have a serious alternative health care plan. They didn't have a serious budget alternative. They were bargaining in bad faith at best. The R's are going to have to do better to be taken seriously. Right now the R's are coming across as cynically using the Tea Partiers to regain power while remaining tools to the wealthy. Y'all are going to have to stop blaming Pelosi as being an obstructionist.

 

[illinoisplanner]

I'm calling bull on this one ip. The only thing the R's had was same of the old tax cuts for wealthy bull that hadn't worked before. The R's showed zero interest in working together. They had fake, meaningless proposals that they knew wouldn't go anywhere. It's was meaningless pandering to the people who own them and run the party.

The R's did not have a serious alternative health care plan. They didn't have a serious budget alternative. They were bargaining in bad faith at best. The R's are going to have to do better to be taken seriously. Right now the R's are coming across as cynically using the Tea Partiers to regain power while remaining tools to the wealthy. Y'all are going to have to stop blaming Pelosi as being an obstructionist.

Actually, tax cuts do work. And when you cut them for the wealthy, the wealthy invest in the market and create jobs. It worked when Bush passed tax cuts, effectively ending the 2001 recession rather quickly, when unemployment was brought from above 6% to as low as 4%.

And the Republicans did have a serious alternative health care plan. Research the bill I referenced if you don't believe me, instead of just labelling anything the Republicans propose as not being "serious". That is the kind of attitude the Democrats had that caused them to lose 60+ seats. If you want cooperation and bipartisanship, you don't just label the other side as not being serious, and throw any of their ideas out the window. If the alternative proposal needs work, you work with the other side to build upon it to make it better, not just trash it and excuse it. Why would the Republicans want to work with someone that is so dismissive of any idea they have? Bipartisanship is a two-way street and the Democrats are going to have to recognize that. Now that Pelosi won't be in charge, maybe we'll get some actual progress and cooperation.

 

[Veloise]

Comspiracy theorists:

Is the Tea Party unduly influencing the voting on Dancing with the Stars?

(Tall slender elegant graceful Brandy was voted off tonight. Chub-face Bristol Palin, still on.)

 

[illinoisplanner]

Is the Tea Party unduly influencing the voting on Dancing with the Stars?

(Tall slender elegant graceful Brandy was voted off tonight. Chub-face Bristol Palin, still on.)

I thought it was a dancing contest, not a beauty contest. Also, Brandy had sort of a cocky off-putting attitude, which doesn't bode well with the public in competitions like this. Regardless, I think Jennifer Grey has done the best.

 

[kalimotxo]

Actually, tax cuts do work. And when you cut them for the wealthy, the wealthy invest in the market and create jobs. It worked when Bush passed tax cuts, effectively ending the 2001 recession rather quickly, when unemployment was brought from above 6% to as low as 4%.

And the Republicans did have a serious alternative health care plan. Research the bill I referenced if you don't believe me, instead of just labelling anything the Republicans propose as not being "serious". That is the kind of attitude the Democrats had that caused them to lose 60+ seats. If you want cooperation and bipartisanship, you don't just label the other side as not being serious, and throw any of their ideas out the window. If the alternative proposal needs work, you work with the other side to build upon it to make it better, not just trash it and excuse it. Why would the Republicans want to work with someone that is so dismissive of any idea they have? Bipartisanship is a two-way street and the Democrats are going to have to recognize that. Now that Pelosi won't be in charge, maybe we'll get some actual progress and cooperation.

There's a significant lag time between the implementation of economic policies and any effects they might have on the economy. No economist worth his/her salt would claim that Bush's tax cuts were solely or even primarily responsible for significantly lowering the unemployment rate. Attributing the state of the economy in 2002-2003 to Bush's economic policies is similar to blaming Obama for the 9+% unemployment rate. These things are functions of trends that significantly precede their attendant administrations. I lean left, but I'll be admit that policies implemented during the Clinton administration probably helped precipitate the housing crisis from which we are still recovering.

That said, trickle down economics do not work. Stimulating the top tier with the simple expectation that jobs will be created just doesn't pan out. Beyond that, the current state of the economy is not something that can be fixed by simply letting the rich keep more of their money. The economic system was fundamentally spooked - and rightly so - by the phantom economy the biggest banks were allowed to create... something that can be traced as far back as deregulation policies during the Reagan administration.

I've read the Republican health care "plan" and WYP's assessment seems pretty fair. The package basically relied on tax cuts, tort reform, and removing barriers to interstate purchases of health care packages. Aside from curbing some insurance company abuses like denial based on pre-existing conditions, the Republican proposal would have done essentially nothing to bend the cost curve of health care in the long term. It would have pleased hospitals and those in the medical profession. Unfortunately, doctors aren't expensive simply because they face the threat of lawsuits. They are expensive because they invest a significant fraction of their lives and hundreds of thousands of dollars to receive a degree and they understandably expect high compensation for their investments. I liken tort reform to the current Tea Party attacks on pork. It's an easy argument to make politically and it seems reasonable, but it will do essentially nothing in terms of actually saving money. The Democrats had no business entertaining such proposals because they knew Republicans had a significant interest in maintaining the status quo to please a financially important component of their constituency - insurance companies and most of the medical care industry.

 

[illinoisplanner]

Well, I guess we're just going to have to agree to disagree.

 

[Hink]

That is the kind of attitude the Democrats had that caused them to lose 60+ seats.

It was the economy that did this. If you really think people like the republican's more than the democrats, just watch what happens in 2012 if the republicans act like republicans.

If you want cooperation and bipartisanship, you don't just label the other side as not being serious, and throw any of their ideas out the window.

Don't you think this a bit hypocritical? The republicans basically made this argument, then did it themselves. They never once took the democrats arguments as serious and just threw them out the window as socialist and other such ridiculous names. If the republicans think that because they won 60 seats it means that their views are held by the general public I think they will find a rude awakening.

People want jobs, and the economy to get better. They don't care who runs the country to get there.

Cooperation is the key. Not party lines or bickering.

 

[Whose Yur Planner]

Don't you think this a bit hypocritical? The republicans basically made this argument, then did it themselves. They never once took the democrats arguments as serious and just threw them out the window as socialist and other such ridiculous names.

This was the point I was trying to make. The R's put out proposals they knew wouldn't work, refused to compromise on these cynical, fake plans then b!@#$%^ about the D's not willing to "compromise". HP brought out another good point. The R's then proceeded to trash talk the D's then stir up their base to further muddy the waters. As perhaps one of the more cynical people on this board (which is saying alot) I can recognize when someone else is doing it. Again, my point was the R's were bargaining in bad faith. then claiming the D's wouldn't work with them. Their whole point wasn't to compromise and work together. The only R's that did where Snow,Collins and a couple of others. The R's preceeded to demonize them for doing it.

 

[imaplanner]

Actually, tax cuts do work. And when you cut them for the wealthy, the wealthy invest in the market and create jobs. It worked when Bush passed tax cuts, effectively ending the 2001 recession rather quickly, when unemployment was brought from above 6% to as low as 4%.

.

Bush's record is one of negative millions of net jobs. The unemployment rate came down from the 6% before the tax cuts took effect.

When taxes are cut for the wealthy, historically there is less job growth. It is a misnomer that when the weathy get tax cuts they invest and create jobs. To the contrary. Investments in business and job creation are tax deductible. When taxes are higher the wealthy, rather than pay taxes- invest back into their businesses. When tgheir taxes are cut, the incentive for re-investment is gone.

 

[wahday]

For such contentious topics, this is a pretty lively and civil discussion. Politicians should take notice...

Personally, I do not believe that the additional extension of tax cuts to the wealthy will increase the creation of jobs (and I'll say why in a moment). Also, I would ask the very obvious question of where the hell all the money we need to deal with this recession is going to come from? There seems to be an attitude that we can both cut all of these taxes and also shrink the government enough to be just fine. But this is not business as usual. We are in a severe financial crisis which will, no matter if you are D or R, require some serious revenue generation to get us out of it. There is a lot of rhetoric about out there about how The Government needs to stop being so bloated and careless with money, tighten its belt and suck it up. Sure, maybe there are some areas for improvement, but I personally feel the suggestion that government is so wildly wasteful in its spending to be a lark. And besides, WE as taxpayers fund the government, so maybe its US that need to tighten our belt, suck it up and pay the taxes so we can actually do the things that need to be done. This idea that people can go on with business as usual and just pass the burden of correcting budget shortfalls to "the government" seems irresponsible to me. Its the United States, afterall - we ARE the government.

As for the tax breaks for the wealthiest, I think its sobering to take a look at just how much money we are talking about. Secondly, I might ask why the wealthy are not already creating jobs in this economic climate. Its not because they lack the capital, but because of the market conditions. The risk is high, loans are harder to get and the future is uncertain. No matter how much excess cash one has, this is not the kind of environment where people are going to be taking chances by starting new businesses or expanding existing ones unless the payoff is a fairly sure thing. With such little growth in the economy, its hard for me to see how this will happen in the near future.

Given that, its my opinion that the government will better use that money to stimulate/address/manage economic stabilization better than the wealthy. These tax cuts were supposed to be temporary, afterall. And the Republicans' position seems disingenuous. They want to extend the cuts which means a huge shortfall in revenue for the government while at the same time complaining that there is not enough revenue to pay for government programs (not the least of which is the Bush Stimulus Plan which THEY voted for!). It all feels to me more like a strategy for 2012 than a genuine concern for the future economic health of the nation.

IMHO...

 

[illinoisplanner]

Bush's record is one of negative millions of net jobs. The unemployment rate came down from the 6% before the tax cuts took effect.

When taxes are cut for the wealthy, historically there is less job growth. It is a misnomer that when the weathy get tax cuts they invest and create jobs. To the contrary. Investments in business and job creation are tax deductible. When taxes are higher the wealthy, rather than pay taxes- invest back into their businesses. When tgheir taxes are cut, the incentive for re-investment is gone.

Actually, the Jobs and Growth Tax Relief Reconciliation Act of 2003 accelerated the tax cuts for the wealthy, making them effective retroactively for the year 2003. In the following years, from 2004-2007, that's when U.S. unemployment sank to the low 4-5% levels and the economy experienced robust growth.

As for Hink_Planner and WYP, I'm sorry, I'm not going to continue this game of you saying the Republicans weren't cooperating enough while I say the Democrats weren't cooperating enough.

 

[TexanOkie]

Investments in business and job creation are tax deductible. When taxes are higher the wealthy, rather than pay taxes- invest back into their businesses. When tgheir taxes are cut, the incentive for re-investment is gone.

This is a rarely-heard, yet perhaps the most potent, demand-side argument. However, the fact of the matter is, and this is against both supply and demand siders, there's a lack of conclusive evidence for either opinion. Each side has its own facts and figures which it claims proves its theories right, but the reality is much more nuanced - possibly even too nuanced to draw any substantial conclusions (with certain notable exceptions). I personally think it's to the point where tax policy only marginally (if even that, though again there are several specific-instance notable exceptions) influences the economic cycle, and for the most part is a derivative of, not a contributor to, political ideology.

 

[imaplanner]

Actually, the Jobs and Growth Tax Relief Reconciliation Act of 2003 accelerated the tax cuts for the wealthy, making them effective retroactively for the year 2003. In the following years, from 2004-2007, that's when U.S. unemployment sank to the low 4-5% levels and the economy experienced robust growth.

As for Hink_Planner and WYP, I'm sorry, I'm not going to continue this game of you saying the Republicans weren't cooperating enough while I say the Democrats weren't cooperating enough.

Unemployment was lower during the years previous to the Bush tax cuts for the wealthy. IMO that supports the theory that lower taxes for the wealthy do not drive employment.

http://www.bls.gov/cps/prev_yrs.htm

 

[Planit]

As for Hink_Planner and WYP, I'm sorry, I'm not going to continue this game of you saying the Republicans weren't cooperating enough while I say the Democrats weren't cooperating enough.

I think all three of you are right...I mean correct. Neither side is being cooperative and these partisan games are not helping, in fact they continue to drive the wedge deeper.

 

[Hink]

As for Hink_Planner and WYP, I'm sorry, I'm not going to continue this game of you saying the Republicans weren't cooperating enough while I say the Democrats weren't cooperating enough.

I'm confused. What game? Look at the facts. Be non-ideological for a second. I understand that you back the R's. I get that. You need to be open to what is actually happening though. Can you give me some examples of republicans supporting a democratic bill in the last two years?

---------------------------------------

I have a tough time with the Bush Tax cuts. If we keep them in place we are looking at a $4tillion loss of revenue. If we keep them cut, we give the country some reprieve from higher rates, which no matter what are going to have to come.

My personal opinion is that we should raise the wealthy concept. Tax those making $1million or more. Or make it $5million. No one would argue that is wealthy. These people also fall out of line with the small business world, and other reasons for taxation problems. If you make $5million a year you either A.)Own a successful large business, B.) Are part of the Wall Street Machine, or C.) Are a CEO or VIP at a large company.

Those are the people that can afford to pay. I would argue that those aren't the small business owners, who create jobs. If a CEO doesn't take home as much money, the company doesn't stop hiring because of it. Lately it has been the exact opposite. If you can succinctly explain to me why these people shouldn't be taxed I would like to hear it, because I can not understand why. Unless the argument is that these people would invest their money into a business if they had more of it. Which is speculative and really I don't see as a valid reason. If these wealthy folks want to invest, and they believe it is a good business, they will do it. They have good business minds and understand the ROI and value of such deals. They might do "more", but they wouldn't just sit out.

 

[illinoisplanner]

For such contentious topics, this is a pretty lively and civil discussion. Politicians should take notice...

Personally, I do not believe that the additional extension of tax cuts to the wealthy will increase the creation of jobs (and I'll say why in a moment). Also, I would ask the very obvious question of where the hell all the money we need to deal with this recession is going to come from? There seems to be an attitude that we can both cut all of these taxes and also shrink the government enough to be just fine. But this is not business as usual. We are in a severe financial crisis which will, no matter if you are D or R, require some serious revenue generation to get us out of it. There is a lot of rhetoric about out there about how The Government needs to stop being so bloated and careless with money, tighten its belt and suck it up. Sure, maybe there are some areas for improvement, but I personally feel the suggestion that government is so wildly wasteful in its spending to be a lark. And besides, WE as taxpayers fund the government, so maybe its US that need to tighten our belt, suck it up and pay the taxes so we can actually do the things that need to be done. This idea that people can go on with business as usual and just pass the burden of correcting budget shortfalls to "the government" seems irresponsible to me. Its the United States, afterall - we ARE the government.

As for the tax breaks for the wealthiest, I think its sobering to take a look at just how much money we are talking about. Secondly, I might ask why the wealthy are not already creating jobs in this economic climate. Its not because they lack the capital, but because of the market conditions. The risk is high, loans are harder to get and the future is uncertain. No matter how much excess cash one has, this is not the kind of environment where people are going to be taking chances by starting new businesses or expanding existing ones unless the payoff is a fairly sure thing. With such little growth in the economy, its hard for me to see how this will happen in the near future.

Given that, its my opinion that the government will better us that money to stimulate, address, manage economic stabilization better than the wealthy. These tax cuts were supposed to be temporary, afterall. And the Republicans' position seems disingenuous. They want to extend the cuts which means a huge shortfall in revenue for the government while at the same time complaining that there is not enough revenue to pay for government programs (not the least of which is the Bush Stimulus Plan which THEY voted for!). It all feels to me more like a strategy for 2012 than a genuine concern for the future economic health of the nation.

IMHO...

I can't believe that you would suggest American people have to tighten our belts and pay for this bloated government? We've tightened our belts enough. That's why the economy sucks...nobody is spending any money on anything, just getting by on as little as possible.

Spending cuts need to be on the table, not tax increases. There are so many federal government programs chock full of wasteful spending. I agree that there are vital functions of the government, but even cuts can be made here too. Federal employees' salaries far exceed that of private sector employees, so that's one cut that needs to be made. I think federal employees would do just fine making $40K or $50K like the rest of us instead of $100K+. Sure, they'd have to move out of their McMansions in Maryland and into a more modest split-level, but so be it. There is a lot of overlap in programs too, both within the federal government (do we really need both a Dept of Labor and a Dept of Commerce?) and among federal and state governments, and I think most of the vital forms of these government programs can actually be found at the state and local levels. And enough with the pork. If people want to fund new programs and new facilities, they can do so at the local level.

And the wealthy are not creating jobs in this climate because there is so much uncertainty. They're anticipating tax increases and increasing economic turmoil, so they're going to hoard it in mattresses or whatever. Once the tax cuts are made permanent, they will have more confidence going forward into the future, to not only invest in job and business growth, but to invest in the economy personally as well. The rich like to go on vacations and buy fancy things, and when they spend, that means more money is being pumped into the economy, which leads to a precipitous chain reaction of events that lead to a healthier economy, which is good for everyone.

Unemployment was lower during the years previous to the Bush tax cuts for the wealthy. IMO that supports the theory that lower taxes for the wealthy do not drive employment.

http://www.bls.gov/cps/prev_yrs.htm

The unemployment rate was low during the late 90s, yes, but after the tax cuts, they went back to this low level again. I'm broadly speaking here...it was in the 4-5% range from 1997-2001, and then dropped back down to 4-5% from 2004-2007, once the tax cuts took effect.

http://www.infoplease.com/ipa/A0104719.html

 

[Hink]

Spending cuts need to be on the table, not tax increases. There are so many federal government programs chock full of wasteful spending. I agree that there are vital functions of the government, but even cuts can be made here too. Federal employees' salaries far exceed that of private sector employees, so that's one cut that needs to be made. I think federal employees would do just fine making $40K or $50K like the rest of us instead of $100K+.

I have a lot of comments on your thoughts, but I really just want to say one thing. Spending cuts will not fix this problem. Most spending cuts should come with tax increases. That will fix the problem.

I can say here in Ohio that we are going to have to have tax increases at a local level, because there is so much "waste" at the state level. Instead of funding local governments like they do every year, they will be cutting their funding because our governor-elect wants to have less "waste" at the state level. What does that mean for the general public? Less services, and higher taxes. You can only cut so much. In the end there is a baseline that can be supported, and people don't accept that baseline. They want more than that. Taxes support these quality of life issues.

I also think that it isn't for you to judge what a federal employee makes. Maybe it is bloated, but if they live in DC it is just like working in NYC. They get paid more because the cost of living is higher. The private sector has little to nothing to do with this argument. I can list many examples where CEO's make more than city managers with similar budgets. Does that mean the CEO should be paid less? The government employees many people. Are these people and their families and employment not as important as private sector employees? Where will these people get jobs? Sure I wish I made $100k. I would like to hope that someday when I do, someone doesn't determine that I just don't deserve it because the government is bloated.

 

[illinoisplanner]

I have a lot of comments on your thoughts, but I really just want to say one thing. Spending cuts will not fix this problem. Most spending cuts should come with tax increases. That will fix the problem.

I can say here in Ohio that we are going to have to have tax increases at a local level, because there is so much "waste" at the state level. Instead of funding local governments like they do every year, they will be cutting their funding because our governor-elect wants to have less "waste" at the state level. What does that mean for the general public? Less services, and higher taxes. You can only cut so much. In the end there is a baseline that can be supported, and people don't accept that baseline. They want more than that. Taxes support these quality of life issues.

I also think that it isn't for you to judge what a federal employee makes. Maybe it is bloated, but if they live in DC it is just like working in NYC. They get paid more because the cost of living is higher. The private sector has little to nothing to do with this argument. I can list many examples where CEO's make more than city managers with similar budgets. Does that mean the CEO should be paid less? Sure I wish I made $100k. I would like to hope that someday when I do, someone doesn't determine that I just don't deserve it because the government is bloated.

Well, if the citizens at the local level are having a hard time balancing the budget and tax hikes are the way to go, so be it. That's how it should be. If people in certain areas need more services, they should pay for it themselves, not ask for someone halfway across the state or halfway across the nation to pay for it.

As for federal employees, sure, the top echelon should be making $100K or whatever is appropriate depending on how much work they do or responsibility they have, but people are routinely making ridiculous amounts in lower-level jobs. And don't give me the cost-of-living line. I've seen regular planning jobs in the DC area at the local level for only $30K or $40K, so the equivalents that work for Uncle Sam should be paid the same. There is affordable housing in the D.C. area, and if there's not, then there should be. The whole cost of living/housing bubble thing is what got us into this mess in the first place.

I'm confused. What game? Look at the facts. Be non-ideological for a second. I understand that you back the R's. I get that. You need to be open to what is actually happening though. Can you give me some examples of republicans supporting a democratic bill in the last two years?

That's the problem right there. We shouldn't be saying, "when have Republicans supported a Democratic bill in the last 2 years?" or "when have Democrats supported a Republican bill in the past 2 years?", because it would be hard to find a good example, at least of a bill that is prominent. We should be asking, "when have the two parties sat down recently and drafted a bill together with equal input from both sides?"

 

[CJC]

This is a rarely-heard, yet perhaps the most potent, demand-side argument. However, the fact of the matter is, and this is against both supply and demand siders, there's a lack of conclusive evidence for either opinion. Each side has its own facts and figures which it claims proves its theories right, but the reality is much more nuanced - possibly even too nuanced to draw any substantial conclusions (with certain notable exceptions). I personally think it's to the point where tax policy only marginally (if even that, though again there are several specific-instance notable exceptions) influences the economic cycle, and for the most part is a derivative of, not a contributor to, political ideology.

I would tend to agree, with the exceptions of corporate taxes, accounting requirements, and regulations/fees/taxes on repatriation of capital.

Personally, I'd love to see all taxes on corporations done away with, with counterbalance adjustments made to income, capital gains, and dividend tax rates. Corporate taxes are nothing more than another way to complicate the system and allow hidden subsidies (through tax breaks and the like, which can give competitive advantage not only related to other corporations, but also to other entities that may pay taxes in different ways - personal income, etc), but it sounds ridiculous to most people - "wait, you don't want Exxon to pay any taxes?" Nope, I want the owners of Exxon to pay taxes.

 

[Hink]

There is affordable housing in the D.C. area, and if there's not, then there should be. The whole cost of living/housing bubble thing is what got us into this mess in the first place.

And who requires this housing? The government? Either the government artificially creates a market (stopping the private sector from making MORE money), or they pay their workers enough to live in these houses... either way it isn't some crazy bloating.

That's the problem right there. We shouldn't be saying, "when have Republicans supported a Democratic bill in the last 2 years?" or "when have Democrats supported a Republican bill in the past 2 years?", because it would be hard to find a good example, at least of a bill that is prominent. We should be asking, "when have the two parties sat down recently and drafted a bill together with equal input from both sides?"

I agree with you. As long as you accept that it isn't the democrats that did all this. It was one of the few things that both parties do well, make needed legislation impossible to pass.

 

[illinoisplanner]

And who requires this housing? The government? Either the government artificially creates a market (stopping the private sector from making MORE money), or they pay their workers enough to live in these houses... either way it isn't some crazy bloating.

Yes, the local governments, which should have policies in place to provide for affordable housing in their communities. And there is quite a bit of money to be made from the construction of apartment complexes, townhomes, and collecting rent or mortgage from these units.

 

[wahday]

I can't believe that you would suggest American people have to tighten our belts and pay for this bloated government? We've tightened our belts enough. That's why the economy sucks...nobody is spending any money on anything, just getting by on as little as possible.

It seems that among the things we need to pay for are: two wars, stimulus plan investments, and so much more that has led to our enormous deficit. I don't think its constructive at this point to say WHO is responsible for creating the deficit because its there and its real. People say, "we can't leave all of this debt to our children." Well, I guess we better start paying it down then. I am also not suggesting that the bulk of the tax revenue be derived from the poor, working classes. But we pay the LOWEST taxes of any industrial nation in the world. Given our COLLECTIVE situation, I am suggesting that, yes, for those that can afford to do so, we pay a little more. I am willing to pay a bit more and I don't make very much. I see it as a civic duty. Yes, I'm a crazy patriot

Spending cuts need to be on the table, not tax increases. There are so many federal government programs chock full of wasteful spending. I agree that there are vital functions of the government, but even cuts can be made here too.

I seriously doubt the cuts to spending could equal what will be lost in potential revenue by not letting the Bush tax cuts expire. Plus, its not just a question of covering our costs. We actually need to generate a surplus to address that deficit.

Federal employees' salaries far exceed that of private sector employees, so that's one cut that needs to be made. I think federal employees would do just fine making $40K or $50K like the rest of us instead of $100K+. Sure, they'd have to move out of their McMansions in Maryland and into a more modest split-level, but so be it.

Well, that all depends on who you ask and how you look at the issue. Below is a quote from a Washington Post article reporting on the government stats on this topic in 2010. President Bush earned a salary of $400,000 plus a $50,000 nontaxable expense allowance. By contrast, the average Standard & Poor's 500 company CEO took home $11.75 million in 2005.

So, another question one might ask is why private industry pay is so low and why the income disparity between the upper management and the average worker is so vast?

http://www.washingtonpost.com/wp-dyn/content/article/2010/11/02/AR2010110206424.html

Official numbers released by the government last week show salaries of federal workers falling slightly further behind their private-sector counterparts in the past year, by an average of 2.1 percent across the country.

There is a lot of overlap in programs too, both within the federal government (do we really need both a Dept of Labor and a Dept of Commerce?) and among federal and state governments...

Well, they don't really do the same thing, so probably. You could move the Dept. of Labor under the Commerce Dept., but are you really saving any money in doing so? The functions are not replicated.

Bureaus and Agencies under the Department of Commerce:
* Bureau of Industry and Security (BIS)
* Economics and Statistics Administration (ESA)
* Bureau of Economic Analysis (BEA)
* Census Bureau
* Economic Development Administration (EDA)
* International Trade Administration (ITA)
* Minority Business Development Administration (MBDA)
* National Oceanic and Atmospheric Administration (NOAA)
* National Telecommunications and Information Administration (NTIA)
* Patent and Trademark Office (PTO)
* National Institute of Standards and Technology (NIST)
* National Technical Information Service (NTIS)

By contrast, the Department of Labor "administers and enforces statutes that promote the welfare of U.S. wage earners, improve their working conditions, and advance their opportunities for profitable employment." Essentially it enforces all of the labor laws in the country at through various administrative courts. Discrimination Laws, Minimum Wage Laws, Disability Laws, etc. The Commerce Dept. doesn't do any of that.

And the wealthy are not creating jobs in this climate because there is so much uncertainty. They're anticipating tax increases and increasing economic turmoil, so they're going to hoard it in mattresses or whatever. Once the tax cuts are made permanent, they will have more confidence going forward into the future, to not only invest in job and business growth, but to invest in the economy personally as well. The rich like to go on vacations and buy fancy things, and when they spend, that means more money is being pumped into the economy, which leads to a precipitous chain reaction of events that lead to a healthier economy, which is good for everyone.

Well, I think how to make the economic environment less uncertain is at the crux of how to get thing back on track. And I am a pretty enthusiastic free market supporter for the most part. However, even Adam Smith acknowledged that certain economic situations do require government interaction to "correct the market." Again, if you look at the gap between the very wealthy "job creators" and the rest of the country, it makes me question just how much cash they need before they feel comfortable enough start creating jobs. My fear is that a small amount of this money will enter the economy and fuel jobs (whether it be to go on vacation or expand a business), instead tying up even more crucial resources in forms that are inactive and not stimulating growth.

 

[illinoisplanner]

wahday, you bring up some interesting points. I guess we all need to decide what's more important here right now...creating jobs or reducing the deficit. To create jobs, you have to give businesses some incentive to do so. And I don't think that incentive will be raising taxes. To reduce the deficit, you either have to raise taxes or cut spending. So, as a result, the only option to do both appears to be to cut taxes or at the very least not let the tax cuts expire in order to create an investment for businesses to create jobs, while cutting spending to work at reducing the deficit.

And I think defense spending should also be on the table as well. Not for necessary spending to adequately equip our troops, but I think we've invested a lot of unnecessary money into Iraq and Afghanistan to build those people these palaces of new facilities. And that stuff has to stop. And also with weaponry, I think there are more efficient ways to build machines that will get the job done without costing a fortune. As for the Departments of Commerce and Labor, they actually were one department awhile ago. I guess if they were condensed again, at least you would cut some of the expensive jobs at the top (like reducing it from two cabinet secretaries to one, reducing assistants, etc. But you're right, it probably wouldn't cut much.

The main thing that costs so much money is entitlements like Social Security and Medicare, and thanks to the aging population, so the amount of money that needs to be paid out is only going to continue to increase year after year unless something is done to reform these systems. I think it's unfair to punish the younger generations to pay for the mistakes of the older generations that created this flawed system in the 60s.

You bring up an interesting point about income disparity in the private sector. Yes, some CEOs make a lot of money. But I guess that's how the private sector works. It's all on good faith, and some people are better at being more modest so they can pay their employees more, while some reserve huge paychecks for themselves. Granted, it does take a lot to run a company, but you're right, I don't know why some people insist on making multiple millions of dollars rather than just a million.

One thing that's interesting to point out is that Bush took 8 years to increase the U.S. annual budget by a trillion dollars (and that included a recession, 9/11, two wars, Katrina, a market collapse, etc.), while Obama is on track to increase it another trillion in only 3 years. That's unacceptable, and we need to hold the line of federal government growth unless they have a way to pay for it.

 

[Whose Yur Planner]

Cut what programs? Cut what agencies? The Park Service, which is always a favorite conservative. Cut the EPA, another favorite target of the conservatives? The DEA, the FBI, FEMA, DHS, where does the knife go? Keep in mind that we've had 2 disasters recently that resulted from little regulation or enforcement. Conservative/TEA Partiers like to talk about cutting the Federal Government for two reasons. One, they don't have to provide details. Second, it weakens enforcement of regulations they find onerous, but protect the people.

As for pay federal government employees, again a nice buzz concept that requires little details. But darn if it doesn't sound good and fans the fear/loathing of people who don't understand how government works. I've interviewed in places where I couldn't afford to live-Naperville, Birmingham, MI. COLA is a very real problem in certain areas. DC is an incredibly expensive place to live. I interviewed in the DC/Virginia area before. The people who work there live far away, like Pennsylvania.:-c The market does not provide affordable housing.

If you want to really help create jobs, help the small employers, not the corporations. They actually pay taxes and live in the community.

 

[CJC]

As for the Departments of Commerce and Labor, they actually were one department awhile ago.

If by "awhile ago" you mean early 20th century, yes, you're correct The Air Force and Army were actually one entity a while ago too...

It's pretty tough to compare how we did things prior to WWI and how we do things now. The world is an entirely different place.