Say Anything Blog

Notice that this “steep rise” in tax revenue is coming from corporations and the wealthy.

Yep, that’s cause the rich and cooperations pretty much pay all the taxes in America already.  How can the poor (like myself who don’t pay federal income tax) increase their tax?

Exactly right, Spaghetti.

You can’t really cut taxes for people who already pay little, if anything, in.

When the people fear their government, there is tyranny; when the government fears the people, there is liberty.

-- Thomas Jefferson

Rob’s recently listened-to songs:

In essence, every tax cut is a ‘tax cut for the wealthy’ because the poor sure aren’t paying income taxes.

Actually, with the EITC the wealthy are paying the poor.

You can’t really cut taxes for people who already pay little, if anything, in.

Silly Boys!  You simply invent another tax “credit” such as the “Earned Income Credit” via which you transfer even more money from those who have earned it to those who haven’t, and then, because you are a liberal for whom definitions and language in general are merely political tools, you call it a “tax cut” and trumpet your handiwork to the “folks” back home who now regard you as some sort of fiscal genius for acquiring for them that which they could not or would not obtain on their own volition.

And if you include the word “Fairness” often enough in your press releases and campaign literature, CAP, PAW, and other such leftist think tanks (man… talk about an oxymoron!) will endorse your re-election thus gaining access to all sorts of liberal fund-raising sources.

Actually, with the EITC the wealthy are paying the poor.

yeah, the feds gave me over a grand last year… isn’t that amazing? I make 50g’s have a mortgage and two kids and the government decides to start giving me money… amazing

Some years back I qualified for the EITC but didn’t claim it on my tax return.

They refigured my return and gave it to me anyway!

I really, actually did not want to be a welfare recipient and didn’t even need the money.

They refigured my return and gave it to me anyway!

This is an example of politicians “padding the stats.” By forcing people like you to take this credit they can then turn around and use the inflated number of people who got the credit as evidence in support of keeping the credit.

“See how many people we helped?” Yeah, but how many people actually needed or wanted the help?

When the people fear their government, there is tyranny; when the government fears the people, there is liberty.

-- Thomas Jefferson

Rob’s recently listened-to songs:

I really, actually did not want to be a welfare recipient and didn’t even need the money.

Which is why you are on the Right side of so many of these discussions… It’s called being principled, a rare and often courageous point of view which places questions of right and wrong on a plane above mere expediency.  To liberals, this perspective is totally alien, and often causes an outbreak of hives.

“See how many people we helped?” Yeah, but how many people actually needed or wanted the help?

Never mind the more pertinent question of how many of those who actually provded the funds needed or wanted to do so.  Amazing how much “good” one can do when its done with other people’s money.

Yeah, I felt like my principles were being violated actually.

I think the EITC is a way to get people to accept the idea of being a welfare recipient in a very sneaky way, and I didn’t want to be a part of it. So I purposely left it out of my return.

The Economic Ship still taking on water.
Spending continues to increase , a net loss
of revenue.

he surprise windfall could shrink the deficit this year to $300 billion, from $318 billion in 2005 and an all-time high of $412 billion in 2004.

The Birth Tax

federal debt has ballooned to $8.3 trillion, up from $5.6 trillion when Mr. Bush took office. Republicans are trying to raise the authorized debt ceiling to $9.6 trillion.

“The long-term outlook is such a deep well of sorrow that I can’t get much happiness out of this year,” said Douglas Holtz-Eakin, a former director of the Congressional Budget Office and a former White House economist under President Bush.

Gee WOOF, shouldn’t some enterprising Democrat be out there running on a platform of smaller government then?

Bueller?

Bueller?

Bueller?

Yeah, we could wipe that debt out completely in just a few years if we did away with the entitlement programs you liberal parasites demand and made you buy own groceries. You could be doing your share to help apy it down if you had gotten an education, got a decent job, saved your money, invested wisely and risked your earnings like the evil rich did. But instead you chose to be a lazy waste of oxygen and whine because everyone who is doing 100 times what you are to help aren’t doing enough. If the world was a fair place they’d have left you on an ice floe to die before you turned 15. They could even use your reasoning, it’s for the better of all mankind.

Is there a politician who doesn’t run on fiscal responsibility, balancing the budget and reducing gov’t waste?

How can the poor (like myself who don’t pay federal income tax) increase their tax?

Work hard, get an education that rewards you, get a better job, get a second job.  Save your money and invest it wisely to become an Eeevil capilist.

Or go the John Kerry route and marry rich.  Of course if they all come like the ketchup lady I’d rather not pay taxes.

Just trying to help. 

Of course we could reform that program today and save it if the Demoncrats weren’t scaring the seniors so that they can hold onto what power they still have.

Woof: “Is there a politician who doesn’t run on fiscal responsibility, balancing the budget and reducing gov’t waste?”

The last Democrat to tell the truth about the Dem agenda, Fritz Mondale, as I remember.  He promised to raise taxes.  Look where that got him.

Woof, as we learned from so many politicians, promises are bunk; the only thing that matters is results.  If you want to know how that is going to go, look at the philosophy of the Party in question.  Does it promise that the govt is going to take care of everything?  If so, vote for the other guys.

TW: The Dems are just taking advantage of, and helping to spread, the propaganda about SS that has been going on since FDR.  What will save SS is the economic truth, perceived by an economically-educated public.

Work hard, get an education that rewards you, get a better job, get a second job. Save your money and invest it wisely to become an Eeevil capilist.

Or go the John Kerry route and marry rich. Of course if they all come like the ketchup lady I’d rather not pay taxes.

Just trying to help.

Unfortunately for me, it’s too late for the latter option… unless I were to get rid of the wife and try again :-D

Looks like I’ll have to stick with the former…

WOOF said, The Birth Tax

AKA the tax laid upon us by the socialist liberals.

Are you taking credit for the problem WOOF?

Notice that this “steep rise” in tax revenue is coming from corporations and the wealthy.

Where else is it going to come from? It’s not like poor people have more to spend. Simple economics: rich people spend more and save more; poor people do the opposite. So it’s obvious that the same is possible when it comes to taxes.

SS-I think he was just pointing out the fallacy that the Demoncrats are advancing that the Bush tax cuts unfairly benefited the rich. 

The rich are paying a larger share of income taxes than anytime in recent* history.

*in the early days of the income tax it was exclusively levied on the Rich.  Of course the Demoncrats made sure that more and more people were paying.

The problem with social security is that if it closes down, nobody will get the money they paid into it (whereas they’d get only some of it if it were in existence). My grandma’s paid into social security since its inception and apparently hasn’t gotten near the amount she put into it. The setup is terrible. Rather than taking that own person’s money to pay for that person, and investing it- they take someone else’s money. Some of the money is wasted on wasteful government programs that are not social security. So many people have paid massive amounts of money into social security and will not be getting near that amount. We wouldn’t be wanting social security if we invested wisely and had good insurance agencies.

SS, you also missed that they dropped the rates for the wealthy, thereby creating more wealth, thereby increasing the percentage of taxes paid by the rich.

The fact that the effect of the tax rate decrease was observed so quickly certainly suggests that even the current rate is likely well above the optimal level.  Flat tax anyone?

sorry, I’m lost: which rates?

Marginal tax rates.

The problem with social security is that if it closes down, nobody will get the money they paid into it

Well agreed, but since that money’s been blown anyway, what’s the fix?  If we were to reform it now, I’d accept that.

Sticking my kids with a failed program doesn’t seem like a good idea, even if I got screwed.

well if your kids are my age, they’re already stuck with paying into something that they will get nothing out of. And it’s a sad thing that you aren’t allowed to fully invest until you’re 21 years old. How’s that going to help my retirement (if I can’t invest)?

Student,

A marginal tax rate is the rate at which the next dollar you earn is taxed.

Your overall tax rate is obviously less than the marginal rate.

What is truly amazing is the enormity of the economic boom brought on by the Bush tax cuts, particularly given the fact that theses current cuts were not nearly as substantial or dramatic as those enacted by Ronald Reagan or JFK.

My kids are too little to pay taxes, so far.  If Hillary Clinton wins in 2008 I’m sure she’ll have a plan to remedy that situation.

What is truly amazing is the enormity of the economic boom brought on by the Bush tax cuts, particularly given the fact that theses current cuts were not nearly as substantial or dramatic as those enacted by Ronald Reagan or JFK.
Bat One on July 9, 2006 at 9:03 PM

Maybe it’s because all of those hippies that went up to live in Canadia?

well really, according to my economics book, since we are currently at full employment, we can’t get much better. Creating tax cut after tax cut will cause rapid inflation and destabilize the economy. And that is all according to my book. Economics, 16th edition by Mcconnell.

well really, according to my economics book, since we are currently at full employment, we can’t get much better. Creating tax cut after tax cut will cause rapid inflation and destabilize the economy. And that is all according to my book. Economics, 16th edition by Mcconnell.

If you burn it you may get heat out of it, so it was competely wasted.

First of all we are still accepting immigrants.  Secondly “full employment” will lead to greater productivity out of the same people.  Trading capital for manpower.

Tax cuts do NOT cause inflation.  That just doesn’t make one bit of sense.  In fact money spent by the private sector is nearly always spent more wisely than if it were spent by the government sector.

Tax cuts have improved the economy EVERY time they’ve been tried.

Only the govt can cause long-term inflation, through taxation and regulation.  In fact, short term price increases due to rapid growth are not inflationary, because they represent a true increase in value.  Those price increases call forth more supply.  Inflation does not call forth more supply.

ss: An increase in wages due to full employment is not wage inflation.  Read your textbook; if it’s accurate, it will tell you that inflation is a rise in the price of something without an increase in its value.  Full employment with increased capitalization yields a rise in both the price and the value of labor, so it is not inflation.

"When recession occurs, an expansionary fiscal policy may be in order...three main options: 1.) increase government spending 2) reduce taxes 3.) use some combination of the two” (215)

“the government could reduce taxes to shift the aggregate demand curve rightward.” (216)

according to what came from the book for exam #2, because an expansionary policy is implemented during full employment, it will lead to a keynesian trap in which the prices will inflate. (somewhere in chapters 6 - 12).

“Suppose the economy is operating at its full-employment output and businesses and government decide to increase their spending—actions that shift the aggregate demand curve to the right...Perhpas firms boost their investment spending because they anticipate higher future profits from investments in new capital. Those profits are predicated on having new equipment and facilities that incorporate a number of new technologies. And perhpas government increases spending to expand national defense...the increase in aggregate demand beyond the full-0employment level of output causes inflation. This is demand-pull inflation, because the price level is being pulled up by the increase in aggregate demand.” (203)

The main component of inflation is when government increases the money supply faster than population and productivity grow.  In that case you have more dollars chasing less goods, hence inflation.

IMO the rise in oil prices will NOT contribute to overall inflation.  That’s because consumers make choices and adjust their spending patterns to the new reality.

Value in a free enterprise economic system is determined by what people are willing to pay for things.  Value is determined at the microeconomic level in a demand system, not the macroeconomic level.

SS...There I believe they are thinking in closed terms.

In the case of rising labor prices many businesses have decided to outsource their production or other services.  (Full-employment has no meaning in this case as the US market can outbid the rest of the world).

Secondly the move to increase productivity has been going on since the industrial revolution.  It’s still in the works.

Third without the government increasing the money supply faster than productivity x population people will NOT have more money to bid up inflation.

ss: That’s old Keynesian stuff.  It has been discredited.  Too bad they didn’t retire that textbook.

ss: That’s old Keynesian stuff. It has been discredited. Too bad they didn’t retire that textbook.

It fits the socialist playbook the Democrat politicians like to play. 

SS, how old is that textbook?

TW: Monetary policy is dependent on the demand for Treasury notes.

TW: Monetary policy is dependent on the demand for Treasury notes.

I agree, should be.

Demand by who.  If the Federal Reserve buys Treasury notes you wind up with increased money supply.

it’s actually new, although, they are coming out with another new book this fall.

...and the copyright on this book is 2005.

TW: Right.  Someone has to want to sell them, after they have bought them in the first place.  This is fairly old school.  The overall transactions in the private sector are more significant these days, which is why most of what you hear about is fiscal policy.  Much more capital is widely held by the private sector.

l. The overall transactions in the private sector are more significant these days,

Because it’s good non-inflationary policy by the Federal Reserve.

Much more capital is widely held by the private sector.

Which of course makes it non-inflationary.  However it does raise the price of capital investment which slows growth.

ss: They must have not updated that part of the text in light of modern knowledge.

ss: They must have not updated that part of the text in light of modern knowledge.

IMO it’s more likely a function of the liberalism of the author and college professors.

which one? all of it?

TW: But growth hasn’t slowed.  The part of the population that “clips coupons” is fairly small, and not as significant as it used to be.  The part of the economy that invests dynamically has grown.  IMO, inflation is no longer much of a danger to the private sector.  Cutting taxes and regulation is the real key to sustained growth, but it threatens the income of the political class.  Therein lies the problem.

the website: http://www.mcconnell16.com

The book is “economics”, not micro or macro.

It must be a good book.

Someone told me they thought it was too “republican”. and here, I’m getting that it’s too “liberal”.

Hmmmm, I wonder which one it is.

ss:  Look up some stuff on Keynesian economics and John Maynard Keynes.  You might find it interesting.

ss: I only said that it contains information that has been discredited.  Economics isn’t either Republican or Democratic.  It just so happens that Republicans embrace economic reality, for the most part, and present-day Democrats don’t.

TW: But growth hasn’t slowed. The part of the population that “clips coupons” is fairly small, and not as significant as it used to be.

Robert, what I was saying is that the Government is bidding up interest rates (and other investment capital).  Because it’s more costly it takes longer for companies to make capital improvements.  That slows growth.

IMO, inflation is no longer much of a danger to the private sector.

Provided we have responsible people in the Federal Reserve.

Cutting taxes and regulation is the real key to sustained growth, but it threatens the income of the political class. Therein lies the problem.
robert108 on July 9, 2006 at 10:01 PM

Agreed.

It must be a good book.

Someone told me they thought it was too “republican”. and here, I’m getting that it’s too “liberal”.

Hmmmm, I wonder which one it is.

Economics as Robert has inferred is a reality, not an opinion.

oh I was referring to the whistler’s comment about democrats and republicans.

I would say that good economics is to the right of the Republican party.  I imagine that not too many college professors would choose such a book.

Let’s not forget that it’s not up to the government to manipulate the public.  They should stay out of the way and let us get on with making the economy work.

One thing that I see as drastically wrong is the federal reserves insistance on raising interest rates over and over.  While they were historically low and needed to come up they’ve gone too far.

You have a situation know where the prime rate for short term borrowing 8.25% while 30 year mortgages are selling for under 6.5%.

The Fed in effect sets the short term rates, while the market sets the long-term rates such as mortgages.

TW: My main thesis here is that with the growth of privately held capital, in terms of the number of private investors, the importance of govt interference in the economy has diminished.  Macroeconomics is less important, as microeconomics has become more important.  More than even tax cuts, the decrease of govt interference in the economy has been responsible for the sustained growth under this administration, in stark contrast to the meddling of the previous administration.

TW: It is my firm belief that interest rates should reflect market value, and not be subject to fed control at all.  It is beneficial for the true value of money to prevail, which is what the prime rate should represent.  Keeping it otherwise damages someone, you can be sure of that.

TW: In other words, the old chestnut that higher interest rates inhibit growth is a static state analysis.  The truth is, low interest rates favor one segment of investment over others.  It happens to be the segment that yields lower return.  Higher interest rates favor investments that yield higher returns.  Which type of growth is more favorable for the overall economy?  I agree that if interest rates are higher than the market value of money, investment will be suppressed overall, but it is also true that return is suppressed when interest rates are lower than the market value of money.

I’d like to make a final note that the district that this university is in is a primarily republican district. Pretty much everyone in the district voted for Bush.