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Showing posts with label Bush tax Cuts. Show all posts
Showing posts with label Bush tax Cuts. Show all posts

Thursday, June 25, 2015

The Tax Revenue Zombie Lie Rises Again

It amuses me to no end when zombie lies rise again. Check this out.

GOP strategist Christie: Tax revenues rose after Bush tax cuts in 2001 and 2003

Once again...

What we found is Christie is carefully picking his starting and end points to make the most dramatic comparison. Changing the timeframe makes all the difference, as we’ll show you.

Indeed:)

The Tax Policy Center, a joint project of two academic centers the Brookings Institution and the Urban Institute, summarized the CBO numbers. This chart based on the center’s table shows revenues initially falling, not rising.



In short, federal revenues were below 2000 levels (after adjusting for inflation) until 2006. They outpaced fiscal year 2000 collections for a bit, then fell again in 2008. The same pattern roughly holds if you use 2001 as the starting point. What’s that all mean? When you adjust for inflation, the 47 percent revenue growth from 2003 to 2007 becomes 28 percent. And if you start the clock in 2001, revenue growth drops to 4 percent. By 2009, of course, the numbers look even worse. Here’s another way to look at it, using data from the Federal Reserve Bank of St. Louis. Over Bush’s two full terms, federal revenues dropped 13 percent.

Christie’s statement has some superficial accuracy but a more complete picture shows that he has omitted many details that would lead to a different conclusion. We rate this claim Mostly False.

Superficial accuracy pretty much sums it up!

Tuesday, November 22, 2011

Why We Have Elections

Yesterday, the poorly name "Super Committee" failed to reach a deal to cut spending and raise revenue before the self imposed deadline. This is not a shock to most folks and it's certainly not to me.

What does perplex me is that the main sticking point was the taxes on the wealthy. This was the GOP's line in the sand and it amazes me that they are sticking to their guns. According to the latest poll, 67 percent of Americans believe that taxes should be raised wealthy Americans AND on businesses. Add this in with the numbers from the same poll that show that 77 percent of respondents disapprove of the way Republicans handle their job.

This tells me that the election next year isn't going to be kind to Republicans at all. If they had made some compromises and not played the shell game with taxes, they would have likely held strong in the House, taken the Senate, and made the election painfully close with the president very possibly losing to likely nominee Mitt Romney. As it stands now, however, they have abandoned the independents (see: the ones who actually decided elections) and I think they are going to lose seats in the House (although still hold on to it), the Democrats will hold onto the Senate (possibly gaining a seat or two) and the president looks to be the likely winner.

Of course, we are still a little less than a year out and a lot could change between now and then but one thing I know that won't change is conservative intransigence. They are not going to back down and all the polling shows that's a terrible idea. This Congress has the lowest approval ratings in the history of Congress (between 9 and 13 percent). You thought the 111th Congress was bad? The 112th has now been called the worst ever.

This is why we have elections. The Tea Party brought a bunch of hard right folks into office and the American people can plainly see how they govern. They don't. Many of these folks have said they don't care if they lose next year's election and are in office for only one term. They just want to do the "right" thing.

Well, they aren't. And they will.

Saturday, November 19, 2011

Saturday Potpourri

Starting today, I'm going to use Saturdays to clear out my "Ideas For Posts" links folder. I have so many and, sadly, most get thrown out or forgotten. Rather than write an entire post around each one (very time consuming), I'm going to highlight a point or two from each link and then hope that readers here at Markadelphia will take it upon themselves to read the rest of the post off site.

First up is a look at how the Bush Tax Cuts have affected our economy using quite a bit of data. The conclusion?

This is economic madness. It is policy divorced from empirical evidence. It is insanity because the policies are illusory and delusional. The evidence is in, and it shows beyond a shadow of a reasonable doubt that the 2001 and 2003 tax cuts failed to achieve the promised goals.

How much more evidence do we need that we made terrible and costly mistakes in 2001 and 2003?

Well, the answer sadly is that there is no amount of evidence to convince them because they don't live in reality.

Speaking of that bizarro reality, here's a piece from a while back on patriotism.

How did Americans arrive at the obscene point where people routinely say, “If you don’t agree with me you aren’t a real Christian” or a “real American,” or a “genuine patriot”? By what measure of chutzpah did the Republican right challenge the patriotism of those who disagreed with their Iraq policy during the Bush years? That’s not American democracy. Rather it smacks of Europe’s bellicose totalitarian regimes of the past century.

The Tea Party and its supporters need a history lesson because this is how it starts.

How did waterboarding return to national attention? Apparently, GOP contender Michele Bachmann is a staunch supporter of it but, of course, would not want to undergo the process herself calling it "uncomfortable" but not torture.

Yeah....

Thursday, November 17, 2011

Temporarily Inconvenienced Millionaires

Yesterday, the Patriotic Millionaires, a growing group of wealthy individuals who are demanding that Congress raise their taxes, went to Congress and pestered the offices of Senators John Kyl, R-AZ, and Pat Toomey, R-Pa., Reps. Nancy Pelosi, D-Calif., minority leader, Xavier Becerra, D-Calif., and Jim Clyburn, D-S.C., assistant democratic leader.

They were led by entrepreneur and former AOL exec Charlie Fink who apparently didn't get the memo that innovators and the wealthy are under attack by vicious government regulators and idiotic moochers all bent on taking the fruits of their hard earned labor with the butt of a gun. Shit, man, didn't this Fink guy see what happened to Steve Jobs and Apple? The US federal government destroyed him.

Fink, who lives in Washington, D.C., said if the Bush tax cuts do not expire, the country "is digging itself a big hole by foregoing revenue." "Without revenue, we will never solve the problem by giving tax cuts to the wealthy while supporting two foreign wars," he said.

Patriotic Millionaire Robert Johnson, former chief economist of the U.S Senate banking committee, said that the current economic system is not broken, but it is "working on behalf of those who designed it in their favor."

"America is no longer based on markets and capitalism, instead our economy is designed as 'socialism for the rich' – it is designed to ensure that the wealthiest people take all of the gains, while regular Americans cover any losses," he said at a press conference this afternoon in Washington, D.C.

"It's a Las Vegas economy where regular Americans put their money on the table and the richest 1 percent own the house," he said. "And if the 1 percent happen to lose money, the 99 percent bails them out – covers their losses and then stands by watching while the house does it all over again."

Amen, brother.

Of course, the response to these simple facts usually consists of any or all of four of the following. First, the wealthy pay more than half of the total taxes. Second, their portion or responsibility of total revenue has doubled over the last 30 years. Third, half of Americans pay no taxes. Fourth, the wealthy pay a higher ratio of taxes paid to income earned than any other country.

All of their points are true but, as is usually the case, they leave out information and don't tell the whole story. A recent article in The Christian Science Monitor explains all of this in a very balanced way. Here are four graphics that take a serious and critical look at the whole picture.





In looking at all of this information, it's obvious that the various cheerleaders for the wealthy (or at least only some of them now that Buffet and the PMs are out lobbying to have their taxes raised) are not being honest. No one is denying that the half of the story they are telling is true. It's the other half that brings out the technicolor and shows us that we have some very serious problems with the way our country is being run by both public and private leaders. As Mr. Johnson said above, it's "socialism for the rich" and no longer capitalism. But why is it this way? How can people (and I'm speaking specifically of a few my regular commenters here in addition to the 40 percent of this country who votes GOP) who aren't wealthy continue to support Bizarro Capitalism? Sadly, the answer is simple.

Because they view themselves as temporarily inconvenienced millionaires.

Tuesday, August 09, 2011

The Tax Cut Experiment

Last month the Republicans inadvertently conducted a test to see how tax cuts affect pricing. The result undercuts their own arguments.

Last month the FAA's authorization to collect taxes on airline tickets lapsed. According to who you ask, this was the result an argument over welfare for rural airports or another of the right's never-ending attempts to destroy unions in America.

When the tax was removed, the airlines quickly raised ticket prices to their previous levels, pocketing the tax money instead of passing the savings on to consumers. Now that agreement has been reached in Congress, the FAA has been reauthorized and the ticket tax has been restored, airlines have been rolling the fare increases back, so that ticket prices remain the same.

The airlines have essentially swallowed the tax increases, reducing their own profits. There are lots of reasons for this, but the simple fact is that companies generally charge as much for things as they can get away with.

The larger lesson is that raising corporate taxes does not mean that the companies will automatically raise prices for consumers, or that the companies will go out of business, or they will flee to other states and countries.

Pricing is a very sensitive issue. Prices cannot rise too high otherwise demand will crater. Most people do not have to fly on airplanes: people can vacation closer to home, and businessmen can choose to use teleconferencing instead of meeting clients face-to-face. So airlines constantly monitor and tweak fares to maximize profit, keeping the planes as full as possible while keeping costs like fuel as low as possible.

Profitability at corporations varies widely. Some industries don't have intense material or capital costs. Lady Gaga can reduce the price of her latest album from $8 to a buck on amazon.com and still make millions, while a grocery store chain's ability to sell food cheaply depends on weather, colony collapse disorder in bees, immigration law, political instability in the Middle East and oil spills in the Gulf of Mexico. Legal and financial products are even more flexible: they're intangibles that only have the value that we arbitrarily assign them.

What this means is that taxes on highly profitable industries that don't have large capital expenses can be raised without really affecting their prices, because they have the flexibility to reduce salaries but their prices are already maxed out. For example, law firms that charge $1,000 an hour could easily pay much higher taxes by cutting the salaries of lawyers who make 10 times what an average person makes. The financial industry could easily pay higher taxes by cutting salaries of hedge fund managers who make millions of dollars a year and pay taxes at the outrageously low capital gains rate of 15%.

All tax cuts and tax increases are not created equal. Since the US economy is driven by consumer spending, tax policies that put more money in the hands of more people provide the biggest boost.

The Bush tax cuts have not done that. The S&P downgrade acknowledges this. The stock market understands this. Everyone knows these things are true, but the Republicans stubbornly refuse to acknowledge reality purely for political gain.

To fix our problems some taxes have to go up, government expenditures (especially defense and entitlements) have to come down , as does the cost of medical care, and more money has to wind up in the hands of the bottom 90% of the US population, instead of just lining the pockets of the wealthy.

Sunday, June 12, 2011

All of Them?

Here's a little ditty that I saved from April.

The Architect Of Reaganomics Calls For The Bush Tax Cuts To End

Greenspan said, “I think this crisis is so imminent and so difficult that I think we have to allow the so-called Bush tax cuts all to expire. That is a very big number. But having put the rates back to where they were in the Clinton administration, I would argue that everything else should be either cutting spending or taking out the subsidies which are in the tax expenditures.”

Wow. There have been a lot of folks from the Reagan era (Bartlett, Stockman) that have all been c coming out against the policies that they used to support. I think that represents some serious reflection and critical thinking at a time when our country needs it.

However, he's one of the morons that got us into this mess and now he's suddenly "seen the light?" Yeah, maybe listening to him might not be a good idea either. There's no fucking way I'd support repealing ALL of the Bush tax cuts. All of them? Really? No way.

More and more every day I am convinced we need some constructivist thinking. I hear "we have a spending problem" and that makes me throw up. We can't repeal the Bush tax cuts for everyone in this sluggish economy. Returning the rates to the Clinton levels on the upper folks is a start but it's clear it won't be enough.

We need to think out of the box and be as non partisan as we possibly can on this one and that means everyone. Any ideas?

Tuesday, May 31, 2011