Basic facts,
a) Bush spent more then Clinton
b) Bush claims he wants a smaller government
c) Clinton was running our country to a profit
d) Bush is running our country to a deficit
If Clinton spent more then Bush Sr, I would say he should spend more then Bush Sr, as we have been told Clinton wanted more government or he was spending more because he could as he was running a profit.
Once again exactly what magicical investment fund is Bush investing our futures in? India ? (only subject on Nightline last night, lead story on both CNN and FNC all of which predict more and more white collar jobs going there, read programmers, with many accounting, medical, and telephone service jobs having already landed there)
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Oh hell we're talking about the US federal budget?
Okay: generally, Republicans build up military technology, equipment, training and either try to hold off on new taxes or cut current taxes. They deregulate and try to privatize government activities. Democrats generally fund people: raise wages of government workers, more college aide, tax incentives for college or child care.
What does the US government spend money on? The Military, Social Security, Medicare,
All number in billions of US dollars, all numbers from the congressional budget office, http://www.cbo.gov for the year 2003.
Discresionary Spending:
Defence 405
International 23
Domestic 400
Non-discresionary:
Social Security 471
Medicare 274
Medicaid 160
Income Support 200
Other Retirement/Disability 130
Other 48
Offsetting Receipts -100
Interest on the Debt: 153
Total spent: 2160
Total income (taxes, etc): 1780
Defecit: 375
*Income Support: "Includes unemployment compensation, Supplemental Security Income, the refundable portion of the earned income and child tax credits, Food Stamps, family support, child nutrition, and foster care."
So the huge "Discresionary Domestic" catagory is not really explained above. I got some numbers from Bush's proposed budget: http://www.whitehouse.gov/omb/budget/fy2005/
which state the values for 2003 for various programs which I *think* are basically in that catagory:
Education 83
Veterens Benefits 57
Transportation 67
Federal Justice 35
Natural Resources/Environment 30
General Government 23
Agriculture 22
Science 20 (includes NASA, NSF)
...and there are a boatload of others. See page 368 of the White House report.
Some quick numbers:
Foreign Aide is in that Discresionary: International area around 23 billion dollars. This is about 1.06% of the total budget. It is only barely larger than science funding, agriculture or the cost of actually running the federal government. Totally re-directing this expense to, say, "Income Support" which is basically, mostly direct aid to the people would only make an increase of 10%.
Those 200 million dollar mars probes that failed? Each was about 0.01% of one year's total budget. (Since they were built over several years you may want to average the costs out further). So it's not like they are really breaking the bank here.
The defecit. The 2003 defecit was 375 billion dollars, about $1400 per person - and that is just one year. This is about 3.5% of the GDP (total value of all goods and services made in one year). Still, we had a defecit in 1983 which was 6% of the GDP - so twice as large in that sense. The 2004 defecit is going to be far bigger and may rival the 6% figure.
Interest on the debt - 153 billion per year is a lot of interest, about $600 per person annually. If we had just resisted the urge to continue cutting taxes we could have a far smaller number here. It seems grossly negligent to outspend what we tax and hand said debt to our children. I think every serious consideration of the budget must either cut the programs or raise taxes. If you are willing to do neither, with specifics, then I'm not going to take you very seriously.
Okay: generally, Republicans build up military technology, equipment, training and either try to hold off on new taxes or cut current taxes. They deregulate and try to privatize government activities. Democrats generally fund people: raise wages of government workers, more college aide, tax incentives for college or child care.
What does the US government spend money on? The Military, Social Security, Medicare,
All number in billions of US dollars, all numbers from the congressional budget office, http://www.cbo.gov for the year 2003.
Discresionary Spending:
Defence 405
International 23
Domestic 400
Non-discresionary:
Social Security 471
Medicare 274
Medicaid 160
Income Support 200
Other Retirement/Disability 130
Other 48
Offsetting Receipts -100
Interest on the Debt: 153
Total spent: 2160
Total income (taxes, etc): 1780
Defecit: 375
*Income Support: "Includes unemployment compensation, Supplemental Security Income, the refundable portion of the earned income and child tax credits, Food Stamps, family support, child nutrition, and foster care."
So the huge "Discresionary Domestic" catagory is not really explained above. I got some numbers from Bush's proposed budget: http://www.whitehouse.gov/omb/budget/fy2005/
which state the values for 2003 for various programs which I *think* are basically in that catagory:
Education 83
Veterens Benefits 57
Transportation 67
Federal Justice 35
Natural Resources/Environment 30
General Government 23
Agriculture 22
Science 20 (includes NASA, NSF)
...and there are a boatload of others. See page 368 of the White House report.
Some quick numbers:
Foreign Aide is in that Discresionary: International area around 23 billion dollars. This is about 1.06% of the total budget. It is only barely larger than science funding, agriculture or the cost of actually running the federal government. Totally re-directing this expense to, say, "Income Support" which is basically, mostly direct aid to the people would only make an increase of 10%.
Those 200 million dollar mars probes that failed? Each was about 0.01% of one year's total budget. (Since they were built over several years you may want to average the costs out further). So it's not like they are really breaking the bank here.
The defecit. The 2003 defecit was 375 billion dollars, about $1400 per person - and that is just one year. This is about 3.5% of the GDP (total value of all goods and services made in one year). Still, we had a defecit in 1983 which was 6% of the GDP - so twice as large in that sense. The 2004 defecit is going to be far bigger and may rival the 6% figure.
Interest on the debt - 153 billion per year is a lot of interest, about $600 per person annually. If we had just resisted the urge to continue cutting taxes we could have a far smaller number here. It seems grossly negligent to outspend what we tax and hand said debt to our children. I think every serious consideration of the budget must either cut the programs or raise taxes. If you are willing to do neither, with specifics, then I'm not going to take you very seriously.
Oh god! Get a grip guy. Let me explain something about your "basic facts":
a) Bush spent more then Clinton
This is an absolutely meaningless statement. Clinton spent more in 1999 then in 1998, he spent more in 1998 then in 1997. He also (drumroll please), spent more in 1997 then in 1996. In fact, if you look at the chart, you will see that every budget in every year for as far back as that chart goes, has been higher then the year before. Bush's budgets are in later years then Clintons, thus his budgets being higher then Clintons are meaningless.
Yes and no. Bush is a Republican, and the Republican platform generally includes a smaller government. That does not mean that every president will always follow the party line, nor does it mean that every Republican budget will be smaller then a Dem budget. It's just a general trend. Like saying that stuff at Sears is cheaper then stuff at Saks. Probably a true statement, but finding one item at Saks cheaper then at Sears doesn't suddenly make the earlier statement that Sears is cheaper then Saks untrue.
No No No and No! Governments do not make "profits". You are aware that government money is made via taxes and tarriffs, right? It is correct to say that a government that spends less then it taxes is running a surplus (and a government that spends more then it taxes is running a deficit). However, it's equally correct to turn it around and say that a government that taxes *more* then it spends runs a surplus and a government that taxes *less* then it spends runs a deficit.
Do you understand that? It's not like Clintons government sold more widgets and made more money that year, or was more efficient or anything. Look at the link I posted. Look at tax revenue per year. Specifically look at the numbers from 2000 to 2003. Notice something odd? They are going down. Notice the previous few years? See anything there? They are going up. In fact, the reason Clinton has a surplus in 1999 and 2000 is because he raised taxes faster then he increased the budget. He over taxed. That's why he had a surplus. Um... that's not necessarily a good thing. I don't know about you, but I don't like the idea that the government takes more money from me in the form of taxes, and just tosses that extra money into a surplus fund (where it doesn't really do anything). I'd rather that money be in the economy where it will be used to buy goods and make investments.
Running a surplus is not ideal economics. It seems so to folks who don't understand economics. The government should aim to come as close to the mark as possible, but it's generally preferable to run a deficit to a surplus. With a deficit at least you didn't take too much more money from the people then you needed.
See the point above. Bush is running a deficit because he's lowering taxes (like he promised).
During Clinton's 8 years in office, he raised taxes (as a percentage of GDP) from 17.6% to 20.9%. In Bush's 3 years in office, he's lowered those same taxes from 20.9% to 16.5%.
The fact is that Bush's taxes are the lowest they've been in, well. I don't know. The chart only goes back to 1962. Um... A long time.
The fact also is that Clintons taxes in 1999 and 2000 were the highest they've been since... Um.. Oops! We're off the chart again. In fact, no president in the time frame listed has a tax rate over 20% other then Clinton, which he maintained for the last 3 years of his last term (98, 99, and 2000).
Of course he had a surplus! He was taxing the hell of out everything. Think about it...
The entire rest of your argument fails because it's based on the faulty assumption that Bush is somehow making "big" government, or that he's somehow wasting our money. Look. You can disagree with spending practices of the Reps if you want, but just making blanket (and completely misinformed) statements isn't really very productive. Why not actually learn something about the topic before trying to argue it? You're very clearly just repeating rhetoric that you've heard, and not taking the time to look at the numbers and make your own conclusions.
Heh. There's plenty of things that Bush is doing that are kinda questionable. But comparing domestic ecnonomic policy between Clinton and Bush really isn't a good topic to work on. Especially when you're starting out with some pretty ludicrous assumptions, and only going downhill from there.
Edited, Tue Feb 17 19:20:01 2004 by gbaji
flishtaco wrote:
a) Bush spent more then Clinton
This is an absolutely meaningless statement. Clinton spent more in 1999 then in 1998, he spent more in 1998 then in 1997. He also (drumroll please), spent more in 1997 then in 1996. In fact, if you look at the chart, you will see that every budget in every year for as far back as that chart goes, has been higher then the year before. Bush's budgets are in later years then Clintons, thus his budgets being higher then Clintons are meaningless.
Quote:
b) Bush claims he wants a smaller government
Yes and no. Bush is a Republican, and the Republican platform generally includes a smaller government. That does not mean that every president will always follow the party line, nor does it mean that every Republican budget will be smaller then a Dem budget. It's just a general trend. Like saying that stuff at Sears is cheaper then stuff at Saks. Probably a true statement, but finding one item at Saks cheaper then at Sears doesn't suddenly make the earlier statement that Sears is cheaper then Saks untrue.
Quote:
c) Clinton was running our country to a profit
No No No and No! Governments do not make "profits". You are aware that government money is made via taxes and tarriffs, right? It is correct to say that a government that spends less then it taxes is running a surplus (and a government that spends more then it taxes is running a deficit). However, it's equally correct to turn it around and say that a government that taxes *more* then it spends runs a surplus and a government that taxes *less* then it spends runs a deficit.
Do you understand that? It's not like Clintons government sold more widgets and made more money that year, or was more efficient or anything. Look at the link I posted. Look at tax revenue per year. Specifically look at the numbers from 2000 to 2003. Notice something odd? They are going down. Notice the previous few years? See anything there? They are going up. In fact, the reason Clinton has a surplus in 1999 and 2000 is because he raised taxes faster then he increased the budget. He over taxed. That's why he had a surplus. Um... that's not necessarily a good thing. I don't know about you, but I don't like the idea that the government takes more money from me in the form of taxes, and just tosses that extra money into a surplus fund (where it doesn't really do anything). I'd rather that money be in the economy where it will be used to buy goods and make investments.
Running a surplus is not ideal economics. It seems so to folks who don't understand economics. The government should aim to come as close to the mark as possible, but it's generally preferable to run a deficit to a surplus. With a deficit at least you didn't take too much more money from the people then you needed.
Quote:
d) Bush is running our country to a deficit
See the point above. Bush is running a deficit because he's lowering taxes (like he promised).
During Clinton's 8 years in office, he raised taxes (as a percentage of GDP) from 17.6% to 20.9%. In Bush's 3 years in office, he's lowered those same taxes from 20.9% to 16.5%.
The fact is that Bush's taxes are the lowest they've been in, well. I don't know. The chart only goes back to 1962. Um... A long time.
The fact also is that Clintons taxes in 1999 and 2000 were the highest they've been since... Um.. Oops! We're off the chart again. In fact, no president in the time frame listed has a tax rate over 20% other then Clinton, which he maintained for the last 3 years of his last term (98, 99, and 2000).
Of course he had a surplus! He was taxing the hell of out everything. Think about it...
The entire rest of your argument fails because it's based on the faulty assumption that Bush is somehow making "big" government, or that he's somehow wasting our money. Look. You can disagree with spending practices of the Reps if you want, but just making blanket (and completely misinformed) statements isn't really very productive. Why not actually learn something about the topic before trying to argue it? You're very clearly just repeating rhetoric that you've heard, and not taking the time to look at the numbers and make your own conclusions.
Heh. There's plenty of things that Bush is doing that are kinda questionable. But comparing domestic ecnonomic policy between Clinton and Bush really isn't a good topic to work on. Especially when you're starting out with some pretty ludicrous assumptions, and only going downhill from there.
Edited, Tue Feb 17 19:20:01 2004 by gbaji
King Nobby wrote:
More words please
The liberal insanity of this post is appalling.
I will grant some leniency in the posting for Flish (I shorten it to Flish because there is but one Taco who posts here) because he was marriend to dalliance for years. That would surely take its toll on anyone.
Tacosid
I will grant some leniency in the posting for Flish (I shorten it to Flish because there is but one Taco who posts here) because he was marriend to dalliance for years. That would surely take its toll on anyone.
Tacosid
I voted for the other guy.
Unoriginal, lackluster, and repetitive.
When cheap shots are all that you can manage, that makes you a has-been, Taco.
Enjoy the status quo. You are the measurement by which all mediocrity falls short.
That's quite an accomplishment.
When cheap shots are all that you can manage, that makes you a has-been, Taco.
Enjoy the status quo. You are the measurement by which all mediocrity falls short.
That's quite an accomplishment.
gbaji, I dispute the "Clinton overtaxed" statement. The US paid 153 billion in interest in 2003 alone. Perhaps paying of the principle off is not a bad idea.
Oddly, most of you seem to be talking as if the president controls the economy in the US. Really, Bush came into office and the economy was sliding. When Clinton came into office, times were bad, but getting better. Policy can (and in Bush's case certainly did) affect the US Federal budget and taxes, but has little influence on the overall economy, which is on the order of 15 trillion US dollars per year.
The economy improves because of the hard work of the average American, not because someone waves a magic wand.
I guess people want some "parental" figure to look up to and to make everything right again - or blame when things are not going well. And this typically happens. Presidents are re-elected when times are good. We fire them when times are bad, but like sports teams firing a coach or manager the players are the same, and (usually) so are the results. (In fact, I would claim a head coach in the NFL (professional American football) has far more influence over his team then the president has on the US economy.)
So please continue debating - I have no problems with you debating big/small government or the effects of tax rate or interest rates on economic growth, but please remember these influences are not so big as you might imagine.
Oddly, most of you seem to be talking as if the president controls the economy in the US. Really, Bush came into office and the economy was sliding. When Clinton came into office, times were bad, but getting better. Policy can (and in Bush's case certainly did) affect the US Federal budget and taxes, but has little influence on the overall economy, which is on the order of 15 trillion US dollars per year.
The economy improves because of the hard work of the average American, not because someone waves a magic wand.
I guess people want some "parental" figure to look up to and to make everything right again - or blame when things are not going well. And this typically happens. Presidents are re-elected when times are good. We fire them when times are bad, but like sports teams firing a coach or manager the players are the same, and (usually) so are the results. (In fact, I would claim a head coach in the NFL (professional American football) has far more influence over his team then the president has on the US economy.)
So please continue debating - I have no problems with you debating big/small government or the effects of tax rate or interest rates on economic growth, but please remember these influences are not so big as you might imagine.
I can't possibly get involved in this because I know NOTHING about budgets, deficits, etc. but man do I have to sympathize with gbaji. trying so hard, but you just gotta give up man. you backed your arguments with facts (i use this term loosely for the fragile nature it defines in this forum) and numbers. Flish comes back with "nuh-uh, your wrong" because "I have 500+ posts somewhere else and know other people that argue"
its almost painful to watch, but i just don't think Flish is gettin it. seems to me like someone just doesn't want to admit they were wrong rather than it being an issue of who is right and who is wrong. but thats just a 3rd party observation.
continue on if you may, but you may wanna get a punching bag to use in between posts gbaji..don't think its gonna get any easier.
its almost painful to watch, but i just don't think Flish is gettin it. seems to me like someone just doesn't want to admit they were wrong rather than it being an issue of who is right and who is wrong. but thats just a 3rd party observation.
continue on if you may, but you may wanna get a punching bag to use in between posts gbaji..don't think its gonna get any easier.
Quote:
Unoriginal, lackluster, and repetitive.
When cheap shots are all that you can manage, that makes you a has-been, Taco.
Enjoy the status quo. You are the measurement by which all mediocrity falls short.
That's quite an accomplishment.
When cheap shots are all that you can manage, that makes you a has-been, Taco.
Enjoy the status quo. You are the measurement by which all mediocrity falls short.
That's quite an accomplishment.
When people that you often ridicule start threads asking you to post more, then I will grant some validity to what you are saying.
Hell, I was not even sure you still posted here. Chalk one up for notoriety!
Tacosid
I voted for the other guy.
yossarian wrote:
gbaji, I dispute the "Clinton overtaxed" statement. The US paid 153 billion in interest in 2003 alone. Perhaps paying of the principle off is not a bad idea.
Yeah. I agree that the deficit in that year was a bit high. However, you're missing a key principle that's part of the cornerstone of Rep economics: The idea that if you reduce taxes (correctly), you will spur industry and increase the GDP as a whole. The result is that when you apply that over time, your growth in GDP and potential taxable "income" down the line means you'll be better of in the long run. You can think of it as an investment in future growth.
The 153 Billion in interest on national debt was not all generated by the deficit generated in 2003, so that's a bit of an exagerration. It's an accumulation of many years that our government has "borrowed" money. A more accurate way of looking at it is that Bush added 536 Billion to the debt. I have no idea what the interest rate is on that, but lets assume a high 8% (say these are all bonds for example). That means that Bush borrowing 536 Billion added 42 Billion in interest for that year (and future years. Ok. That's not too great, right?
But look at GDP (I'm going to use their figures by using their revenue figures and their "revenue as % of GDP figures for consistency. I'm not sure why those are lower then "real" GDP though. Maybe they're looking at some "taxable GDP" area? Dont know. In any case, I'm going to use just the CBO table figures to maintain consistency):
2002: 17.9% tax, 1,853.2B taxed, therefore a 10,353.1B GDP
2003: 16.5% tax, 1,782.3B taxed, therefore a 10,801.8B GDP
Now, we can't say for sure that reduced taxes spurred on the economy and raised GDP during that time period, but that's what the Reps are *trying* to do, and that's what they *claim* will happen. Interestingly enough, that's exactly what did happen in this case.
If we had taxed at the same rate in 2003 as we did in 2002, we would have generated 1,933.4B in tax revenue, an increase of 80.2B dollars. That's more then twice what we "lost" that year in increased interest payments on the deficit we chose to run instead.
The point being that if by running a deficit, you can increase the GDP sufficiently that future tax revenues are increased by a rate higher then the interest on the debt, then you are actually making money. You are indeed "doing more with less money".
I'm going to agree with you on all the other points, and even conceed that your opinion certainly applies to this one. But in that case, you are preaching to the choir. I've been saying all along that a president's actions are only minimally the cause of economic shifts. We can't say for certain whether Bush's economic "plan" cause the GDP to increase at a much higher rate then during Clinton's administration. We can't say what caused the economic downturn of 2001 and 2002 (although most experts have a pretty clear idea that it had *nothing* to do with any government economic plan. We did that one all on our own). I can, however, refute the claims that Bush (and by extention, Republicans) are lying somehow about their economic strategies. In this case, the evidence does suggest that the basic tenents of Rep economics did work. Bush lowered taxes, and the GDP growth rate increased at a rate faster then the interest on the debt he incurred.
Can I show a cause and effect for this? Nope. No one can. There are just too many factors to consider. But, that's the point. You can't sit there and point fingers at Bush and the Reps. Ok. You can, but at least get some facts vaguely correct first. It is correct to say that Bush is running a deficit and Clinton ran a surplus. It is not correct to then assume that Bush's government is "doing less while spending more". Heck. It's not even correct to say that Bush's budget was "larger" then Clintons. That's an amazing oversimplification, and not very correct when you look at budget size in relation to GDP. Larger then Clinton's last 3 years? Yes. But smaller then Clinton's first 5 years (in percentage), and smaller then the average of all of his term (again, in percentage, which is the most relevant number here).
Heh. And that's not even getting into the spillover effect from a previous administration. Each president tends to enact a budget plan that includes expenses running far beyond his own term (and makes assumptions based on that spending plan). Clinton's 2000 budget had spending plans running all the way through 2012. That basically means that he amortized the cost of things he was doing over 12 years (and extending through 3 more administrations after his). Um... It doesn't take a mathmatical genius to see that this will impact future administrations as they are saddled with non-discretionary costs that aren't their own, but that they have to add to their budget anyway.
King Nobby wrote:
More words please
I am fully aware that Republicans believe you can cut taxes and actually grow the economy and thus raise *more* tax income. I'm sure you are fully aware of the counterarguments so I won't bring them up. Let's look at the long history, instead.
I think we both agreed that the immediate effects of any single president's changes are minimal, thus any hope for economic growth would show up slowly over a very long time.
According to this chart of tax rate history:
http://www.clev.frb.org/research/Et2002/0102/briefhist.pdf
we can see the maximum marginal personal income tax rate has fallen from the huge values (78%) in the 50's and early 60's to 60% from about 1963-1983 and down again to current levels.
We should be reaping the benefits of 50 years of reductions in rates. Are we? You can look at the defecit graph below it.
Also, about the 153 billion in interest figure. I don't believe my original statement is misleading: when you have debt such that you are paying 153 billion dollars per year in interest, paying off the principle is not a bad idea.
Further, interest rates are *really* low now. Sadly, that 153 billion figure will probably go back up. In 1997, we paid 244 billion in interest (source: www.cbo.gov) on a smaller debt. If we are going to pay off anything, it is when interest rates are low.
And I have not even begun to talk about the capital gains tax rates. They have also been cut dramatically and they are why the ultrarich - who make most of their income from capital gains not traditional income - are paying a lower rate than I was as a graduate student qualifying for food stamps.
In summery: if not now, then when? John McCain says we are spending money like a drunken sailor. I fully agree.
I think we both agreed that the immediate effects of any single president's changes are minimal, thus any hope for economic growth would show up slowly over a very long time.
According to this chart of tax rate history:
http://www.clev.frb.org/research/Et2002/0102/briefhist.pdf
we can see the maximum marginal personal income tax rate has fallen from the huge values (78%) in the 50's and early 60's to 60% from about 1963-1983 and down again to current levels.
We should be reaping the benefits of 50 years of reductions in rates. Are we? You can look at the defecit graph below it.
Also, about the 153 billion in interest figure. I don't believe my original statement is misleading: when you have debt such that you are paying 153 billion dollars per year in interest, paying off the principle is not a bad idea.
Further, interest rates are *really* low now. Sadly, that 153 billion figure will probably go back up. In 1997, we paid 244 billion in interest (source: www.cbo.gov) on a smaller debt. If we are going to pay off anything, it is when interest rates are low.
And I have not even begun to talk about the capital gains tax rates. They have also been cut dramatically and they are why the ultrarich - who make most of their income from capital gains not traditional income - are paying a lower rate than I was as a graduate student qualifying for food stamps.
In summery: if not now, then when? John McCain says we are spending money like a drunken sailor. I fully agree.
^^^^^^^^ This is why I'm glad that my roommate is a political science major. If I ever have any questions on this type of arguement, he can give me the only-slightly Republican biased facts.
Sheesh, give it a rest you guys. You can argue your opinions all you want, that doesn't mean you are going to change somebody elses'.
Sheesh, give it a rest you guys. You can argue your opinions all you want, that doesn't mean you are going to change somebody elses'.
Jophiel wrote:
I managed to be both retarded and entertaining.
Agreed to the "lower tax==greater growth" argument. That is subjective, and can be endlessly debated. I brought it up only to counter the claims in the OP that the Reps were being inconsistent about their claims versus what they were actually doing. Bush's economic plan is consistent with modern Republican economic strategy. Whether you think that's the best plan or not obviously can be debated. But the OP was trying to claim that Bush was claiming one thing while doing another, and I think I've adequately proved that that's not the case.
Ok. But let's look at the CBO chart for "Total Revenues: 1900-2004 (percent of GDP)" (I provided a link to this earlier I think. I can link it again if I can find it). You will see that over the last century, the government revenue has increased as a percentage of GDP overall. The low point (chart is in 10 year increments up until 2000) is 1910 at 1.9% and the high is 2000 at 20.8%. In 1950, it was 14.4%, and has pretty much floated in the 17-19% range ever since.
So... If personal income tax was 78% in the 50s, and 60% in the 60s (and now below 50% max I believe currently), yet the total revenue of the government in percentage of GDP has remained relatively constant (within a few percentage points, with no discernable relation between variations in that figure and personal income tax changes), then where did the remainder come from? How did we reduce income tax by 20% accross the board while retaining the same percentage of GDP as revenue for the government to use?
The obvious conclusion is that we applied more tariffs (which would just shift the income tax in a different direction since it would increase relative costs for tariffed goods), *or* we increased tax structures on businesses and corporations. Most likely a combination of the above was responsible.
Um... So the quick and dirty answer is that we haven't reduced the amount of money we tax out of the economy over that time period. We've just shuffled around where we take it from. Thus, we wouldn't expect a huge reaping of rewards. Only minor ones as the rate itself dips and rises.
It is interesting to note that this data would seem to dispute the Dem claims that corporate taxes have been decreasing over time, eating into the profits of the "common, working" man. It would seem that the reverse is actually true. Again though, we're looking at this data from an eagle's eye view, so it's hard to make any sort of blanket claim about it. However, the money had to be made up from somewhere. If it didn't come from income taxes, then it had to come from business in some way. After all, average people don't import much stuff, or generally fall under any other sorts of taxes other then income tax. Those "other" sources of tax revenue had to be from sources other then the average working citizen...
I actually agree with you here. However, people do take loans out from banks. They do it for a number of reasons. One way to look at this is that the government is taking a loan out and giving us the money to use. While I agree that running continual, high deficits is a bad thing, the basic prinicple of borrowing money with the assumption that you'll make more money with it in the end is pretty much the cornerstone of economic principle. If that didn't happen, no one would ever take out a business loan, or borrow money to buy a house. We do those things because we hope (assume?) that the increase in value of what we do with the money will be greater then the interest on the principle.
Actually, I'd argue that the exact opposite is true. You want to borrow money when interest rates are low, and then pay off the principle when the interest rates are high. While the parallels between government tax/spend cycles are not exact matches to business models, this basic idea would still apply. Right now is the *perfect* time to run up a deficit. And the tax->GDP-growth idea ties into it. Reduce taxes now, so you leave as much money as possible in the economy. This hopefully stimulates the economy and grows GDP at a faster rate then otherwise. You borrow money (deficit) to make up for the taxes you didn't collect. Then, when interest rates rise again, you increase taxes back up, but now you've got a higher GDP, so you'll get more each year then if you'd left it at that higher rate all along. This allows you to pay off the debt you accumulated several years earlier. If all stays the same at that point, you can maintain the tax rate at the beginning level, and eventually you will pay off the principle you borrowed, and the interest, and start to have more left over. You keep getting that GDP gain forever (more or less).
Heh. Nothing is that perfect, but that's the idea. Certainly, if you're going to run a deficit, the best time to do so is when interest rates are low.
Eh? I believe 29% is still the lowest rate you can get for long term capital gains (18 months or longer - someone correct me if I'm wrong). I'm pretty sure the government did not tax your income at anywhere near that rate if you were collecting food stamps.
And capital gains hardly applies to just the ultra-rich. Lots of employees get stock options as part of their payment, as well as participation in stock purchase plans. We get to pay the same rates as the so-called "ultrarich". Those capital gains tax breaks make it that much easier for us to buy homes with our investment money.
Even joe average person *can* buy stocks if he wants. Go to a stock broker and start placing orders. If you want to invest, you can. There's nothing stopping you. You get the same return rate whether you're a working joe investing a couple grand, or the "ultrarich" investing a couple million. It's all relative to what you risk and how long you risk it. Sure, the ultrarich invest more then they get in income, but what income they get is already taxed at the highest allowable level, right? And capital gains *starts* at the highest level for them. What capital gains does is encourage investors to make longer term investments instead of quick speculative investments. That's it. Personally, I think that's a good thing...
yossarian wrote:
According to this chart of tax rate history:
http://www.clev.frb.org/research/Et2002/0102/briefhist.pdf
we can see the maximum marginal personal income tax rate has fallen from the huge values (78%) in the 50's and early 60's to 60% from about 1963-1983 and down again to current levels.
We should be reaping the benefits of 50 years of reductions in rates. Are we? You can look at the defecit graph below it.
http://www.clev.frb.org/research/Et2002/0102/briefhist.pdf
we can see the maximum marginal personal income tax rate has fallen from the huge values (78%) in the 50's and early 60's to 60% from about 1963-1983 and down again to current levels.
We should be reaping the benefits of 50 years of reductions in rates. Are we? You can look at the defecit graph below it.
Ok. But let's look at the CBO chart for "Total Revenues: 1900-2004 (percent of GDP)" (I provided a link to this earlier I think. I can link it again if I can find it). You will see that over the last century, the government revenue has increased as a percentage of GDP overall. The low point (chart is in 10 year increments up until 2000) is 1910 at 1.9% and the high is 2000 at 20.8%. In 1950, it was 14.4%, and has pretty much floated in the 17-19% range ever since.
So... If personal income tax was 78% in the 50s, and 60% in the 60s (and now below 50% max I believe currently), yet the total revenue of the government in percentage of GDP has remained relatively constant (within a few percentage points, with no discernable relation between variations in that figure and personal income tax changes), then where did the remainder come from? How did we reduce income tax by 20% accross the board while retaining the same percentage of GDP as revenue for the government to use?
The obvious conclusion is that we applied more tariffs (which would just shift the income tax in a different direction since it would increase relative costs for tariffed goods), *or* we increased tax structures on businesses and corporations. Most likely a combination of the above was responsible.
Um... So the quick and dirty answer is that we haven't reduced the amount of money we tax out of the economy over that time period. We've just shuffled around where we take it from. Thus, we wouldn't expect a huge reaping of rewards. Only minor ones as the rate itself dips and rises.
It is interesting to note that this data would seem to dispute the Dem claims that corporate taxes have been decreasing over time, eating into the profits of the "common, working" man. It would seem that the reverse is actually true. Again though, we're looking at this data from an eagle's eye view, so it's hard to make any sort of blanket claim about it. However, the money had to be made up from somewhere. If it didn't come from income taxes, then it had to come from business in some way. After all, average people don't import much stuff, or generally fall under any other sorts of taxes other then income tax. Those "other" sources of tax revenue had to be from sources other then the average working citizen...
Quote:
Also, about the 153 billion in interest figure. I don't believe my original statement is misleading: when you have debt such that you are paying 153 billion dollars per year in interest, paying off the principle is not a bad idea.
I actually agree with you here. However, people do take loans out from banks. They do it for a number of reasons. One way to look at this is that the government is taking a loan out and giving us the money to use. While I agree that running continual, high deficits is a bad thing, the basic prinicple of borrowing money with the assumption that you'll make more money with it in the end is pretty much the cornerstone of economic principle. If that didn't happen, no one would ever take out a business loan, or borrow money to buy a house. We do those things because we hope (assume?) that the increase in value of what we do with the money will be greater then the interest on the principle.
Quote:
Further, interest rates are *really* low now. Sadly, that 153 billion figure will probably go back up. In 1997, we paid 244 billion in interest (source: www.cbo.gov) on a smaller debt. If we are going to pay off anything, it is when interest rates are low.
Actually, I'd argue that the exact opposite is true. You want to borrow money when interest rates are low, and then pay off the principle when the interest rates are high. While the parallels between government tax/spend cycles are not exact matches to business models, this basic idea would still apply. Right now is the *perfect* time to run up a deficit. And the tax->GDP-growth idea ties into it. Reduce taxes now, so you leave as much money as possible in the economy. This hopefully stimulates the economy and grows GDP at a faster rate then otherwise. You borrow money (deficit) to make up for the taxes you didn't collect. Then, when interest rates rise again, you increase taxes back up, but now you've got a higher GDP, so you'll get more each year then if you'd left it at that higher rate all along. This allows you to pay off the debt you accumulated several years earlier. If all stays the same at that point, you can maintain the tax rate at the beginning level, and eventually you will pay off the principle you borrowed, and the interest, and start to have more left over. You keep getting that GDP gain forever (more or less).
Heh. Nothing is that perfect, but that's the idea. Certainly, if you're going to run a deficit, the best time to do so is when interest rates are low.
Quote:
And I have not even begun to talk about the capital gains tax rates. They have also been cut dramatically and they are why the ultrarich - who make most of their income from capital gains not traditional income - are paying a lower rate than I was as a graduate student qualifying for food stamps.
Eh? I believe 29% is still the lowest rate you can get for long term capital gains (18 months or longer - someone correct me if I'm wrong). I'm pretty sure the government did not tax your income at anywhere near that rate if you were collecting food stamps.
And capital gains hardly applies to just the ultra-rich. Lots of employees get stock options as part of their payment, as well as participation in stock purchase plans. We get to pay the same rates as the so-called "ultrarich". Those capital gains tax breaks make it that much easier for us to buy homes with our investment money.
Even joe average person *can* buy stocks if he wants. Go to a stock broker and start placing orders. If you want to invest, you can. There's nothing stopping you. You get the same return rate whether you're a working joe investing a couple grand, or the "ultrarich" investing a couple million. It's all relative to what you risk and how long you risk it. Sure, the ultrarich invest more then they get in income, but what income they get is already taxed at the highest allowable level, right? And capital gains *starts* at the highest level for them. What capital gains does is encourage investors to make longer term investments instead of quick speculative investments. That's it. Personally, I think that's a good thing...
King Nobby wrote:
More words please
Gabaji doesn't even understand the arguments made by THE SIDE OF THE ARGUMENT HE'S SUPPORTING. Trying to explain the other side to him is folly.
It's a Catch-22 if you will, Yossarian.
Republican's create defecits INTENTIONALLY to force long term spending cuts. The idea that tax cuts will eventually raise more taxes because of overall economic growth is a smokescreen. It allways has been. It's been what you peddle to the masses while you're telling them "We'll CUT your taxes and give you more services!"
The long term plan is to cripple the US Government to the point where there is simply no option but to cut spending on entitlements, education, etc. etc. That's the long term goal after all, eliminating nearly all Federal services.
It's a Catch-22 if you will, Yossarian.
Republican's create defecits INTENTIONALLY to force long term spending cuts. The idea that tax cuts will eventually raise more taxes because of overall economic growth is a smokescreen. It allways has been. It's been what you peddle to the masses while you're telling them "We'll CUT your taxes and give you more services!"
The long term plan is to cripple the US Government to the point where there is simply no option but to cut spending on entitlements, education, etc. etc. That's the long term goal after all, eliminating nearly all Federal services.
Disclaimer:
To make a long story short, I don't take any responsibility for anything I post here. It's not news, it's not truth, it's not serious. It's parody. It's satire. It's bitter. It's angsty. Your mother's a *****. You like to jack off dogs. That's right, you heard me. You like to grab that dog by the bone and rub it like a ski pole. Your dad? Gay. Your priest? Straight. **** off and let me post. It's not true, it's all in good fun. Now go away.
To make a long story short, I don't take any responsibility for anything I post here. It's not news, it's not truth, it's not serious. It's parody. It's satire. It's bitter. It's angsty. Your mother's a *****. You like to jack off dogs. That's right, you heard me. You like to grab that dog by the bone and rub it like a ski pole. Your dad? Gay. Your priest? Straight. **** off and let me post. It's not true, it's all in good fun. Now go away.
Quote:
And capital gains hardly applies to just the ultra-rich. Lots of employees get stock options as part of their payment, as well as participation in stock purchase plans. We get to pay the same rates as the so-called "ultrarich". Those capital gains tax breaks make it that much easier for us to buy homes with our investment money.
Cuts in the Capital Gains Tax, the Estate Tax, and especialy the Dividend Tax effect the rich MASSIVELY more than they do the middle class. Think about it. They're all targeted at WEALTH, not income. That's the problem.
I really could care less about income. Income is an imaginary thing once you reach a state of financial independance. I could sell everything I have tommorw and have a seven figure income this year. Alternately I could choose not to accept any compensation other than equity derevitive positions and have ZERO income.
Tax WEALTH equally among everyone. How can anyone possibly argue against that? It's equality. It's paying your fair share regardless of how you came by your wealth. It would be equal for everyone.
Disclaimer:
To make a long story short, I don't take any responsibility for anything I post here. It's not news, it's not truth, it's not serious. It's parody. It's satire. It's bitter. It's angsty. Your mother's a *****. You like to jack off dogs. That's right, you heard me. You like to grab that dog by the bone and rub it like a ski pole. Your dad? Gay. Your priest? Straight. **** off and let me post. It's not true, it's all in good fun. Now go away.
To make a long story short, I don't take any responsibility for anything I post here. It's not news, it's not truth, it's not serious. It's parody. It's satire. It's bitter. It's angsty. Your mother's a *****. You like to jack off dogs. That's right, you heard me. You like to grab that dog by the bone and rub it like a ski pole. Your dad? Gay. Your priest? Straight. **** off and let me post. It's not true, it's all in good fun. Now go away.
"c) Clinton was running our country to a profit" --Flishtaco
Not true. In fact, that statement is blatently wrong, false, even a bald faced lie if you know better while saying it. What is true is that the increasing sum of the interest on our country's debt was getting smaller, but the principle on the national debt was not shrinking at all. By way of example, it just means that instead of getting bigger by let's say, 1 billion dollars per day, for instance, it was only getting bigger by 500 million dollars a day.
This is an a prime example of the myth of Clinton that has arisen in recent years used as cudgel against the myth of fiscal responsibility that Republicans supposedly have earned.
Let's face it, neither party is willing to address the issue of good budgeting, but at least the Republicans are willing to take less of my hard earned money by way of taxes on their way to financial ruin. Does this make it any more clear?
Totem
Edited, Wed Feb 18 00:15:02 2004 by Totem
Not true. In fact, that statement is blatently wrong, false, even a bald faced lie if you know better while saying it. What is true is that the increasing sum of the interest on our country's debt was getting smaller, but the principle on the national debt was not shrinking at all. By way of example, it just means that instead of getting bigger by let's say, 1 billion dollars per day, for instance, it was only getting bigger by 500 million dollars a day.
This is an a prime example of the myth of Clinton that has arisen in recent years used as cudgel against the myth of fiscal responsibility that Republicans supposedly have earned.
Let's face it, neither party is willing to address the issue of good budgeting, but at least the Republicans are willing to take less of my hard earned money by way of taxes on their way to financial ruin. Does this make it any more clear?
Totem
Edited, Wed Feb 18 00:15:02 2004 by Totem
I must take issue with your definition of capital gains being a form of wealth which deserves to be taxed, as opposed to income, Smasharoo. The "rich" aren't the only one who gain substantial benefit from a decrease in the capital gain taxrate, everyone who sells a house and makes money benefits from such a cut. This is the goal of just about every middle class and low income home owner-- to make a profit on the sale of their home.
Totem
Totem
Quote:
When people that you often ridicule start threads asking you to post more, then I will grant some validity to what you are saying.
Hell, I was not even sure you still posted here. Chalk one up for notoriety!
Hell, I was not even sure you still posted here. Chalk one up for notoriety!
Good thing notoriety isn't my primary goal in life, or even in the top 10.
Go back to your regularly scheduled flaming, Taco.
Just leave me out of it.
Quote:
I must take issue with your definition of capital gains being a form of wealth which deserves to be taxed, as opposed to income, Smasharoo. The "rich" aren't the only one who gain substantial benefit from a decrease in the capital gain taxrate, everyone who sells a house and makes money benefits from such a cut. This is the goal of just about every middle class and low income home owner-- to make a profit on the sale of their home.
Sell many homes in your lifetime?
Capital gains up to $250,000 from selling your home has been exempt from taxation for about 20 years now :-)
Nice try though.
Disclaimer:
To make a long story short, I don't take any responsibility for anything I post here. It's not news, it's not truth, it's not serious. It's parody. It's satire. It's bitter. It's angsty. Your mother's a *****. You like to jack off dogs. That's right, you heard me. You like to grab that dog by the bone and rub it like a ski pole. Your dad? Gay. Your priest? Straight. **** off and let me post. It's not true, it's all in good fun. Now go away.
To make a long story short, I don't take any responsibility for anything I post here. It's not news, it's not truth, it's not serious. It's parody. It's satire. It's bitter. It's angsty. Your mother's a *****. You like to jack off dogs. That's right, you heard me. You like to grab that dog by the bone and rub it like a ski pole. Your dad? Gay. Your priest? Straight. **** off and let me post. It's not true, it's all in good fun. Now go away.
Quote:
you backed your arguments with facts (i use this term loosely for the fragile nature it defines in this forum) and numbers
Lol Empyre! You would know.
I have sold two homes now that meet that standard. I consider myself firmly planted in the middle class.
Totem
Totem
My younger brother is a Mortgage broker. On the side, he buys and sells houses. You can't buy a closet for less then 250,000 here in california...
I've sold blocks of shares (as have virtually everyone I know and work with) on which capital gains taxes were relevant. My roomate has a number of mutual fund investments and IRAs out there (not that I ask about her finances much, but that much I know).
Heck. My *mom*. You know. The little old lady that attends church every Sunday, and lives in a house in the hills with her dogs and cats and horses made a killing on shares of stock from the last company she worked for before retiring. That's how she bought a nice ranch style home in the hills for her dogs and cats and horses. She's also been able to take trips to Hawaii and Alaska (and other places) due to her investments and retirement. This is a woman who for the majority of her life scrimped and saved, and never took a trip anywhere because it was a "waste of money".
Tell me again that capital gains dont affect the "average" middle class person Smash. I think you just want sooo desperately to believe it that you just refuse to accept the fact that many many people today invest their money in a variety of ways.
Lowering long term capital gains taxes has one major effect: It encourages the wealthy to keep their large investments in place instead of constantly shifting their money around. This is a good thing. It generates stability in the market. If we taxed all capital gains as income, then there'd be no reason not to pull out investments at the first sign of a downturn. When you have to wait 18 months to get the best tax rate on your return, you're a hell of a lot more likely to ride things out.
I've sold blocks of shares (as have virtually everyone I know and work with) on which capital gains taxes were relevant. My roomate has a number of mutual fund investments and IRAs out there (not that I ask about her finances much, but that much I know).
Heck. My *mom*. You know. The little old lady that attends church every Sunday, and lives in a house in the hills with her dogs and cats and horses made a killing on shares of stock from the last company she worked for before retiring. That's how she bought a nice ranch style home in the hills for her dogs and cats and horses. She's also been able to take trips to Hawaii and Alaska (and other places) due to her investments and retirement. This is a woman who for the majority of her life scrimped and saved, and never took a trip anywhere because it was a "waste of money".
Tell me again that capital gains dont affect the "average" middle class person Smash. I think you just want sooo desperately to believe it that you just refuse to accept the fact that many many people today invest their money in a variety of ways.
Lowering long term capital gains taxes has one major effect: It encourages the wealthy to keep their large investments in place instead of constantly shifting their money around. This is a good thing. It generates stability in the market. If we taxed all capital gains as income, then there'd be no reason not to pull out investments at the first sign of a downturn. When you have to wait 18 months to get the best tax rate on your return, you're a hell of a lot more likely to ride things out.
King Nobby wrote:
More words please
Egads! I can't believe I missed this gem...
Wait! What are you trying to say? Are you claiming *gasp* that the Republicans *gasp* are working towards (wait for it...) smaller government?!
Thank you Smasharoo! Flish: Game set and match
Smasharoo wrote:
Republican's create defecits INTENTIONALLY to force long term spending cuts.
Smasharoo wrote:
The long term plan is to cripple the US Government to the point where there is simply no option but to cut spending on entitlements, education, etc. etc. That's the long term goal after all, eliminating nearly all Federal services.
Wait! What are you trying to say? Are you claiming *gasp* that the Republicans *gasp* are working towards (wait for it...) smaller government?!
Thank you Smasharoo! Flish: Game set and match
King Nobby wrote:
More words please
Quote:
Tell me again that capital gains dont affect the "average" middle class person Smash. I think you just want sooo desperately to believe it that you just refuse to accept the fact that many many people today invest their money in a variety of ways.
If half the crap you have said over the years I have read this forum are true gbaji you are FAR from being in the middle class in fact according to the IRS anyone making over 75,000 a year is in the top 5% of the money makers in the US, so if you are making more then this benchmark or your family etc is then you are not in the middle class, Preach on gbaji pride of the working man you are starting to sound like Bill O'Reilly with the BS of how you represent the middle class and yet are a Millionare. Sheesh.
As to does Bush want smaller government have to call BS on that one to do a Lexis-Nexus search for Bush smaller and government and count for me you Rush Limbaugh ditto head the hits of Bush claiming exactly that, In fact the reason I started the whole F*cking post was because I watched him do it on TV, that night.
My numbers are making sense and you have yet to have told me one F*cking sensible thing that Bush has invested in the whole while claiming that "republicans" invest in things like mutual funds unlike the got a penny **** it away democrats. Hell you think you can do it show me one thing his father invested in that is now bringing us in more money 8 years of Bush.
Why does the budget matter because as I pointed out in the begining sooner or later we are gonna have to pay it back, its either that or just F*ck the world economy. But hell we proved we dont need them to go beat up some bully, ya that whole thing went so well I am still wondering why we didnt think of it earlier, oh ya SR. had more sense or smaller balls, guess that one is a you pick it.
Sorry, I let this one go so long but after like a week without any posts figured you had pussed and run away, my mistake you were prolly just trying to think of something clever to say in 10000 words or less.
Quote:
If half the crap you have said over the years I have read this forum are true gbaji you are FAR from being in the middle class in fact according to the IRS anyone making over 75,000 a year is in the top 5% of the money makers in the US, so if you are making more then this benchmark or your family etc is then you are not in the middle class, Preach on gbaji pride of the working man you are starting to sound like Bill O'Reilly with the BS of how you represent the middle class and yet are a Millionare
What the **** are you talking about? You do know that a million bucks isn't actually that much money right? An easier way to define thge classes.
Working class - have manual, low skilled jobs or are on benefits
Middle class - White collar jobs, work for somebody elses company
Upper class - Have their own companies, or inherited lots of money / capital
(True upper class do not recognise "new" money as qualifying, however much it is. May be different in the US.)
Gbaji from his descriptions of himself most definitely is middle class.
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