Forum:Tax cut expiry
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One other thing, if demand is not meeting supply, why have we had a current account deficit for the last 20 years? We currently import more than we export. The demand is there. [[User:ConservapediaEditor|ConservapediaEditor]] ([[User talk:ConservapediaEditor|talk]]) 20:44, 5 December 2010 (UTC) | One other thing, if demand is not meeting supply, why have we had a current account deficit for the last 20 years? We currently import more than we export. The demand is there. [[User:ConservapediaEditor|ConservapediaEditor]] ([[User talk:ConservapediaEditor|talk]]) 20:44, 5 December 2010 (UTC) | ||
:Yes, a reduced but still substantial demand for affordable Chinese-made consumer products is certainly there. The demand for the same products at much higher prices due to the cost of American labor? Not so much. The demand for American-made cars? Nope, the Japanese ones are cheaper and more efficient. The demand for American industrial machinery? Nope, the German ones are more advanced. These are all markets in which US companies are at a competitive disadvantage, and that's the source of the US trade deficit (and in the case of the auto market, ultimately also the source of a large number of recent job losses). But in a recession and a greatly increased threat of unemployment, consumers reduce their spending across the board, and that hits a ton of retailers and the service sector as well, jobs that have to be local. [[User:Röstigraben|Röstigraben]] ([[User talk:Röstigraben|talk]]) 21:00, 5 December 2010 (UTC) | :Yes, a reduced but still substantial demand for affordable Chinese-made consumer products is certainly there. The demand for the same products at much higher prices due to the cost of American labor? Not so much. The demand for American-made cars? Nope, the Japanese ones are cheaper and more efficient. The demand for American industrial machinery? Nope, the German ones are more advanced. These are all markets in which US companies are at a competitive disadvantage, and that's the source of the US trade deficit (and in the case of the auto market, ultimately also the source of a large number of recent job losses). But in a recession and a greatly increased threat of unemployment, consumers reduce their spending across the board, and that hits a ton of retailers and the service sector as well, jobs that have to be local. [[User:Röstigraben|Röstigraben]] ([[User talk:Röstigraben|talk]]) 21:00, 5 December 2010 (UTC) | ||
| + | ::It simply amazes me that anyone can even try to justify the current taxation levels on the ultra rich. Trickle-down economics is essentially a laughing stock in the field, and income inequality in the US has grown enormously in recent decades to levels near robber-baron levels. Especially absurd is the notion that the ultra-rich have a right to the whole of these earnings, particularly the CEOs making untold millions while their shareholders suffer, and the bankers and investors who profited enormously off the indefensible financial schemes which set off this whole mess in the first place. {{User:Publius/Sig}} 04:57, 6 December 2010 (UTC) | ||
Revision as of 04:57, 6 December 2010
It's no surprise that both sides are playing a game of chicken. This is classic game theory. If either the economy stays stagnant and/or we have brisk price inflation (I am including food and energy here), then Obama loses in 2012. If taxes goes up at the median, regardless of who's ultimately responsible, Obama loses reelection.
But one other thing I think the left has consistently failed to realize, from a purely logical standpoint, the rich do not get a "handout" with a tax cut, they just keep more of what was already theirs. The left seems to feel a sense of entitlement for other people's money, even though the top 1% pay a little less than 40% of all taxes, the top 5% pay a little less than 60% of all taxes, and the top 50% pay almost all of the taxes (97-98%). ConservapediaEditor (talk) 05:15, 5 December 2010 (UTC)
- Taxes are still incredibly low, on a historical scale. Maybe the States should add a VAT like everywhere else. Watch everyone complain. – Nick Heer 05:42, 5 December 2010 (UTC)
- Some states have sales tax, I remember that one sneaking up on me every time I purchased something. I wish they would quote prices with tax like we have to in Australia. - π 05:44, 5 December 2010 (UTC)
- I hear those numbers (or similar ones) thrown around anytime it's suggested that the rich are over-taxed, and presumably it's to encourage a less progressive tax system than the status quo in the U.S. I have no where you got them, or what exactly you mean by 'all taxes', but certainly every citizen who buys anything pays a sales tax. There are taxes on cigarettes, alcohol, taxes or 'fees' for doing many things like driving a car or living in a house. It would be ridiculous to name all of them, and I can't imagine 50% of people get back all or more of their money in direct aid. ALL that aside, it's stupid in the wealthy's interest in any case to want to horde all their money. To sit on it, howl against inflationary but stimulative measures and spend very little of it (and even less domestically) while also paying very little of it in taxes means a shortage of dollars in the hands of people who spend, and a shortage of dollars that could be used to get people to work. It's largely because of that that unemployment remains so high and many people still so miserable in the United States.
- Beyond the obvious moral imperative to alleviate the suffering of others, it's damaging to upper-class interest to create a society of poverty; it will only end up making more extremely difficult. TheDude (talk) 06:08, 5 December 2010 (UTC)
- I have no idea why the left continues to parrot this notion that the "rich will hoard money" if we give them back what's theirs. It's as if fiscal liberals are the creation scientists of economics. There two ways essentially to utilize money, consumption or investment (Macroeconomics 101). The left apparently considers rich people's investments to be hoarding. (Even if you invest in a savings account, that money then is invested by the banks in government Treasuries, so maybe even the left implicitly knows that Obama's big government is a failure). Seriously though, what liberals do not realize is that we need to invest in production before we have goods and services to consume; the cool shit that we have in this developed economy is not just created out of thin air.
- If I'm barely making ends meet, you honestly think I'd go on a spending spree if I got a tax rebate. Sure if I were a total fucking buffoon, but it seems logical that the rich would have more discretionary income to not have to save compared to someone on economic shaky ground. The problem with the liberal economic analysis is that it is predicated upon the notion that millions of poor Americans are starving and homeless and but not for some new government assistance, they are unable to buy the necessities they need. ConservapediaEditor (talk) 06:39, 5 December 2010 (UTC)
- "we need to invest in production before we have goods and services to consume" if consumers have no money, there is no demand for goods and services. An economy is not built by building factories to make stuff, but by creating demand for stuff, whi9ch leads to building factories and creating jobs to make stuff. Supply-side economics is bankrupt. Demand-side economics works. Emerald (talk) 07:21, 5 December 2010 (UTC)
- Historically, any time we've cut the taxes of the rich they've bought bonds, in effect loaning that money right back to the government. I'd really love to hear how that type of investment is stimulative.
- "we need to invest in production before we have goods and services to consume" if consumers have no money, there is no demand for goods and services. An economy is not built by building factories to make stuff, but by creating demand for stuff, whi9ch leads to building factories and creating jobs to make stuff. Supply-side economics is bankrupt. Demand-side economics works. Emerald (talk) 07:21, 5 December 2010 (UTC)
- If I'm barely making ends meet, you honestly think I'd go on a spending spree if I got a tax rebate. Sure if I were a total fucking buffoon, but it seems logical that the rich would have more discretionary income to not have to save compared to someone on economic shaky ground. The problem with the liberal economic analysis is that it is predicated upon the notion that millions of poor Americans are starving and homeless and but not for some new government assistance, they are unable to buy the necessities they need. ConservapediaEditor (talk) 06:39, 5 December 2010 (UTC)
- "If I'm barely making ends meet, you honestly think I'd go on a spending spree if I got a tax rebate." I really do love that term "spending spree." Yes, when you give money to the poor they tend to spend it on necessities because they are just that, necessities. Your problem is that you're only considering short-term necessities (i.e. things you need now or you'll die). Long-term necessities ("personal investments", if you will) include things like property maintainence, replacing worn-out appliances, and making long-term payments, all of which are directly stimulative. And even if they don't have those sorts of necessities, there will always be things they want. People in this country don't save money.
- And then there's the problem Emerald is alluding to: The U.S. has a serious imbalance between supply and demand. Put simply, we have too much stuff and no one to buy it all. Cutting taxes for the wealthy won't help that.
- One more thing: "But one other thing I think the left has consistently failed to realize, from a purely logical standpoint, the rich do not get a "handout" with a tax cut, they just keep more of what was already theirs." I hate it when people say things like this. The right seems to feel that taxes are just the government robbing people for shits and grins. We have this little thing called "society" and that society runs on taxes. If there were a way for people to give back societal benefits in exchange for reduced taxes, I'd be with you, but alas, it's rather a package deal. Colonel of Squirrels医药是医药,和那个不是医药。 07:30, 5 December 2010 (UTC)
- I think both sides of the argument have merit, and since there's been little evidence in practice of either being more effective (since there are a buttload of variables), it's hard to throw my weight behind one. I can't help but think that, if the wealthy buy things, that money won't go to stimulating the American economy. If a wealthy person buys an expensive car, it's probably going to be Italian, British or German. If they're buying a plane, it'll be Canadian or Brazilian. If they're buying wine, it'll be French or Italian (or Californian – they need some stimulus). – Nick Heer 08:06, 5 December 2010 (UTC)
- I, personally, think that the righties who bitch about those "poor wealthiest 1%" forget that, during the longest period of sustained economic growth (not just bubble and burst bullshit) in the United States (from Truman to Kennedy) taxes on the top 1% were between 75% and 91%. On top of that, the wealthy themselves (including Ted Turner, Warren Buffet, Ben Stein, and Bill Gates) admit that raising their taxes wouldn't be a bad idea to fix the nation's bugest crisis. So, let the whining and complaining from the right cease. The fact is, the wealthiest Americans pay less taxes now than they ever have, and to believe otherwise is delusional. Scotch (talk) 08:12, 5 December 2010 (UTC)
- What Emerald and the Colonel said. Recessions and depressions do not happen because there's not enough money for investments available - the US is still awash in capital - but because overall demand collapses, making it necessary to shut down production facilities and terminate employment contracts. In the current economic situation, it makes absolutely no sense to invest in additional facilities when there's still a lot of idle capacity left over. And regarding your point about the poor, exploited top 1% of income earners having to shoulder the largest tax burden: there's a rather simple reason for that, they also get a disproportionally high share of the national income. One of the most fundamental societal developments in the US since the 1980s (and, to a lesser extent, in other developed nations as well) has been a massive income redistribution from the poor to the wealthy. That's what supply-side economics does. Röstigraben (talk) 08:32, 5 December 2010 (UTC)
- I, personally, think that the righties who bitch about those "poor wealthiest 1%" forget that, during the longest period of sustained economic growth (not just bubble and burst bullshit) in the United States (from Truman to Kennedy) taxes on the top 1% were between 75% and 91%. On top of that, the wealthy themselves (including Ted Turner, Warren Buffet, Ben Stein, and Bill Gates) admit that raising their taxes wouldn't be a bad idea to fix the nation's bugest crisis. So, let the whining and complaining from the right cease. The fact is, the wealthiest Americans pay less taxes now than they ever have, and to believe otherwise is delusional. Scotch (talk) 08:12, 5 December 2010 (UTC)
- I think both sides of the argument have merit, and since there's been little evidence in practice of either being more effective (since there are a buttload of variables), it's hard to throw my weight behind one. I can't help but think that, if the wealthy buy things, that money won't go to stimulating the American economy. If a wealthy person buys an expensive car, it's probably going to be Italian, British or German. If they're buying a plane, it'll be Canadian or Brazilian. If they're buying wine, it'll be French or Italian (or Californian – they need some stimulus). – Nick Heer 08:06, 5 December 2010 (UTC)
- One more thing: "But one other thing I think the left has consistently failed to realize, from a purely logical standpoint, the rich do not get a "handout" with a tax cut, they just keep more of what was already theirs." I hate it when people say things like this. The right seems to feel that taxes are just the government robbing people for shits and grins. We have this little thing called "society" and that society runs on taxes. If there were a way for people to give back societal benefits in exchange for reduced taxes, I'd be with you, but alas, it's rather a package deal. Colonel of Squirrels医药是医药,和那个不是医药。 07:30, 5 December 2010 (UTC)
The spooky thing is that you can rely on Americans to vote against their interests. But I think the answer lies in looking at pyramid scams. In America pyramid scams (and MLM which is basically a pyramid scam with a Halloween costume) are hugely popular. Even when we mandate that MLMs reveal up front how much you're going to lose, people believe that applies to some hypothetical person who is dumb, not them. They see that 0.1% of people in the scheme make say $250k per year, and they figure "that's going to be me". But it isn't, it's not going to be even one in a thousand of them, because the schemes are front-loaded, the money makers all know the guy who set it up. When it comes to tax policy - the vast majority of Americans vote as if they made far more income than they do, far more money invested, and way less reliance on the social safety net - which only makes sense if they believe that they will on average soon be doing much better than they are. My conclusion: Unthinking optimism leads America to make bad decisions. 82.69.171.94 (talk) 18:17, 5 December 2010 (UTC)
- I guess the longest period of sustained growth was when we had 5 recessions in a 15-16 year period from 1945-1961. Right .... I have no idea why people think that the 1940s and 1950s were the good, old days. I can get why Trent Lott would think those times were good, but not anybody who understands how a significant part of our population was disenfranchised from any type of economic prosperity that may or may not have occurred, or occurred intermittently within those 15 years. Second, I thought we needed to expand the availability of credit. Investing in bonds does just that. One of the problems with liberal economic policy is that it is extremely schizophrenic. On one hand they want to stimulate the economy, but on the other hand they want to raise taxes. Where were the liberals who are now complaining about the size of extension of the current tax policy during the passage of Obama's failed stimulus? Obama needs this tax increase to cover up the fact that there were admittedly "no shovel ready jobs", contrary to the hoax he tried to perpetuate. ConservapediaEditor (talk) 20:16, 5 December 2010 (UTC)
One other thing, if demand is not meeting supply, why have we had a current account deficit for the last 20 years? We currently import more than we export. The demand is there. ConservapediaEditor (talk) 20:44, 5 December 2010 (UTC)
- Yes, a reduced but still substantial demand for affordable Chinese-made consumer products is certainly there. The demand for the same products at much higher prices due to the cost of American labor? Not so much. The demand for American-made cars? Nope, the Japanese ones are cheaper and more efficient. The demand for American industrial machinery? Nope, the German ones are more advanced. These are all markets in which US companies are at a competitive disadvantage, and that's the source of the US trade deficit (and in the case of the auto market, ultimately also the source of a large number of recent job losses). But in a recession and a greatly increased threat of unemployment, consumers reduce their spending across the board, and that hits a ton of retailers and the service sector as well, jobs that have to be local. Röstigraben (talk) 21:00, 5 December 2010 (UTC)
- It simply amazes me that anyone can even try to justify the current taxation levels on the ultra rich. Trickle-down economics is essentially a laughing stock in the field, and income inequality in the US has grown enormously in recent decades to levels near robber-baron levels. Especially absurd is the notion that the ultra-rich have a right to the whole of these earnings, particularly the CEOs making untold millions while their shareholders suffer, and the bankers and investors who profited enormously off the indefensible financial schemes which set off this whole mess in the first place.

04:57, 6 December 2010 (UTC)
- It simply amazes me that anyone can even try to justify the current taxation levels on the ultra rich. Trickle-down economics is essentially a laughing stock in the field, and income inequality in the US has grown enormously in recent decades to levels near robber-baron levels. Especially absurd is the notion that the ultra-rich have a right to the whole of these earnings, particularly the CEOs making untold millions while their shareholders suffer, and the bankers and investors who profited enormously off the indefensible financial schemes which set off this whole mess in the first place.