I couldn't find sarcasm font when I posted. I know where the racism lies... They president now.

Anyone willing to expose that, not that is hidden just conveniently ignored, is labeled a racist.

Saying that isn't racist. Implying that the reason for all those things happening is due to the color of their skin is.

Obviously there is a reason behind it. The racists will say that it's because black people are lazy and entitled, but that IS racist. I don't know why, but if I had to guess I would say that this country isn't as tolerant as everyone thinks it is.

Okay, we can start by cutting the entire discretionary budget (since entitlements are mandatory). That will disband: the military, the TSA, DHS, IRS, FBI, EPA, Etc.

By sadly, we will still be in the hole about 250 billion a year.

Okay, so now we come to raising taxing. Cool! let's make up that 250 billion shortcoming...although without the IRS it will be hard. But okay.

So we raise the rates up and...uh huh, since the laffer curve is real, we maintain an average of collecting 18% of GDP in taxes...and we don't actually collect more revenue.

https://www.miataturbo.net/attachmen...ine=1352830968


since, it doesn't matter how much you raise taxes, other than help you win an election by raging class warefare, the only thing that can really rudece deficits and balance budgets and reduce debts is to do something about mandatory payments and nothing more.


Insert strawman argument here: ----V

1) Braineack, you left out "growth" as an option.

2) Why is the national debt bad? Why are deficits bad?

1. Public growth is 1%, Economy growth is 2%.
2. It's bad if it becomes so large that it becomes inflationary. They aren't always, public debt is private savings; so I'm told. Im sure you'll argue that government surpluses are actually the unsustainable thing and some long drawn out reason why that I cant comprehend. I'm not smart enough to have an opinion either way, but I find that our entitlement, specifically, damages the economy, and our country tremendously.

I'm not sure why I'm going to tackle this, since it invariably turns out bad. I think I agree with you, and am going to provide my standard response to bigots.

We're all products of our environment.

I do believe that there are cultures that promote bad decisions which lead to dependence, and it crosses skin color lines (which really do not matter). Where skin tone does come in is with real discrimination that makes a lot of bad decisions easier to make, and fosters the cultures that breed them.

It's easy to tell someone that we all have the same opportunities. In reality many in this country are discouraged daily from pulling themselves up. It is harder when you're poor, or a minority. My firstborn's godfather wrote a thesis for his doctorate in education on how minorities perform on standardized testing, and why. Educational differences are an obvious hindrance we conveniently ignore.

Yes, technically you can take the same route. Yet everyone in front of you is looking down, and expecting you to just get by. Everyone around you is showing you how easy it is to just slack off, doing less than what is needed to support yourself. Until all of that is gone there will continue to be a demographic which has a disproportionate share of dependents.

yeah, lazy white people.

Can you shrink that graph some more? It almost looks like a straight line. :rofl:

When 1% of GDP is 150 billion, I think it's worth looking at it closer than from 10 feet away.
http://4.bp.blogspot.com/-6uH_hG_7G-...nue-of-gdp.jpg

If that is true, then bigots have every right to use that as an excuse, same as the dependants. You foster a nanny state, expect there to be those who will come to rely on it. By the same token, there will be those that resent it, and call them lazy. That it falls out along racial lines is not surprising. It's what the media has reiterated, over and over.

I don't think arguing formation of opinions being a product of media environment as equivalent to life choices influenced by your real world environment is fair.

1. I'm not sure what you mean by public growth. But economic growth was what I was getting at. If you can get economic growth moving at a more reasonable clip, the automatic stabilizers built in to the system tend to reduce the need for massive tax hikes or massive spending cuts.

For example, without either, look at the fiscal deficit as a percent of GDP over the past 3 years.

2. You are smart enough, you just haven't had the same exposure to the information or taken the time to learn it (nor have most people, nor did I until a few year ago). [Edit: Although I am making some inroads with my repetitive drum-beating!] "Everything changed in 1971 except the textbooks."


Ultimately, though, your real concern is one of ideology or philosophy (a society that feels entitled to things they may not have worked for). That is okay, but it's important to distinguish between an ideological concern and an operational concern.


For example, I do not think anyone can convincingly explain to me how a large and growing US fiscal debt leads to price inflation and provide any sort of evidence that is not easily dismissed.


I'm going to let it go at that, as there are enough threads where this topic comes up. The racial and demographic issues or the abuse of tax language is more appropriate for this particular thread. :)

I always find that I can get a feel for how incredible a viewpoint is by simply stating its ultimate conclusion.

Its also a great way to be both entertained and embittered at the same time.

population growth. typically when it's slowed it represents a slow economy or better, when the economy sucks, the birthrate is reduced. I believe we are back to great depression pop. growth rates. People dont wanna bring babies into this world cause they aint go no money cuz.

That's not far off. I don't want the US of A to turn into West Berlin. We are headed down that path. So it would be nice to see good fical policy in Washington with a reduction of a biggest issue: entitlements and entitlement spending.

Our Debt alone is 104% of our economy, I really don't see how that can be a good thing at all, I still believe it's a dangerous path. Hell the interest payments alone are going to expotentially take a huge chunk out of the budget and just make it worse. The USA is rated worse than all the EU nations in terms of rising budern of gov't spending.

But Braineack, the USA is a money issuer you say.

Well, my dear friend, I don't care about that. Deficit or Surplus, Issuer or Not, there is one real common bond between all the failing nations--that they all allow the burden of govt to increase faster than the private, productive, sector of the economy. Deficits and Debts are a symptom of this bad policy.

I dont believe that politicians who try to expand government to solve the messes created by previous expansions of government have a clue.

Everything we do today to try to fix issues, is a problem created by some policy of the gov't.

Beyond that, I think entitlements are out of control and dispicable. It's a proven system of failure, time and time again. It doesn't work, no matter how hard to wish apon the my Little Ponies. It's amoral and it's currpotive and it's destorying American values. In 50 short years entitlement spending has increased 100 times; I shudder to think how that has stiffled what could of been. think of all the strawmen that could have benefited...if only. *sigh*

I don't see how you can deny that this will lead to failure. Run on sentence of the year award nominee: We have a system in place that harms the poor and causes unemployement, that is designed to help the poor and cure unemployement, that is taking a bigger and bigger chunk of our economy, and removes incentives for people to maintain and seek jobs, as well as incentives for employers to create jobs. This can't lead to success--gov't dependency that keeps people poor and unemployed while increasing debts and slowing the economy.

We can't live off the 1%, eventually they will become the 2% and 10% and then 50%. Then what? Protest in the streets when the gov't takes away our ice cream?

okay then:

https://www.miataturbo.net/attachmen...ine=1352905644

mind blown?

How are interest payment going to take an exponentially larger chunk of the budget? When interest rates on US Treasury securities (the IOUs of our fiscal debt) rise, that will be because the Federal Reserve has raised their target rates. They will do that because we are seeing economic growth.

How are you defining a "failing nation?" The USA's population is about 4% of the global population but our economy generates over 20% of global economic output. In terms of economic output, the only group that outpaces us is...

The European Union.

On an individual nation level, #2 is China (at about half or less of our output, depending on source cited). #3 on an individual nation basis is Japan... Who has a debt-to-GDP level over 200% and have held interest rates close to zero for almost 20 years while fighting deflation.

:idea:

Many of the "entitlements" are pretty damn reasonable in concept and may be better than the alternatives, even if there are flaws in the execution.

your mom is flawed.


and Japan will continue to fall from Mt. Fuji. Just as most nations, they held little to no debt in the early 80s. Today, thier SS payments are over 52% of their budgets, coincidentally they hold hte most debt of any country. and Now they just doubled their VAT from 5% to 10% in order to "solve" the problem. Yes, entitlements are awesome and doing wonders for Japan. Just wait for 2040 when they hold 600% debt to GDP and they have a workforce of 0% because all their old our dying off faster than the young can fill jobs.

At least Japan was smart enough to lower the corporate tax rate making us #1 in that department.

Anyways, right now Japan's debt is still considered safe...but it's only a matter of time IMHO.

Only a matter of time until what? Until it's not safe? You know who has been saying that for two decades plus? Bond traders, right before they lost their shirt and then, hopefully, their jobs.


I hate that "it's okay now but it's only a matter of time" BS. You know what else? The sun is okay now, but it's only a matter of time before something really bad happens to that big star at the center of our universe and then... WELL! You better watch out!

In fact, because it's only a matter of time - and it's a certainty - you better start wringing your hands and gnashing your teeth and doing things today that will make you worse off like not going out, saving all of your money, selling your Miata, etc.

exactly. doomsday preppin' baby.

What did Japan's various stimulus packages in the 1990s net Japan after it's recession?

according to these pretty pictures, not much:

http://www.heritage.org/static/repor...gif?w=370&as=1

http://www.doctorhousingbubble.com/w...-japan-gdp.png

thier unemployement rate was an all time high ten years after still trying to fix the problem of the 90s. For the last fifty years they've down everything but leave the economy alone...and it will keep getting "worse" for them. I use quotes because it worse is subjective since life continues to move forward everday, so as long as we all don't wake up dead, everything is unicorns and candy.

Japan is a lot more complicated than you are making it out and I don't have the energy or interest to be bothered with a full history. I recommend for those with a legitimate interest.


However, the short version is that Japan dealt with a lot of the same political issues the USA has been undergoing. Their initial stimulus was much smaller than the USA's and they continually institute austerity via either spending cuts or tax increases [edit: those have almost the same damn effect on economic growth and both are contractionary!] before a full recovery which institutes a new slide back toward recession, so they cut taxes or increase spending and then do it over again.

Meanwhile, because the politicians in charge of fiscal policy (i.e. gov't spending and taxing) can't get their shit together, the Bank of Japan (their Fed) has been pursuing measures like quantitative easing and zero interest rate policy for decades.


"In worrying about becoming the next Greece, we risk becoming the next Japan." Instead, we have been Japan on fast forward. That's not to say that Obama and the Republicans won't do their best to imitate the Japanese parliament, though.

You do realize that "top tax bracket" data you keep shoving in my face is worthless, right? I would of been in the top tax bracket from 1988-1990 if you adjust for inflation and, on the other end of the spectrum, you'd need to make around 76.3 million to be in the top tax bracket in 1941.
source

Confirmation bias much?
A broken clock is right twice a day.

As tax savvy as I like to consider myself, I have never seen that data and found it very interesting.

It's also worth noting that the figures in those charts should be taxable income (not AGI or gross). That should represent the income after most deductions and exemptions.

I'm sorry guys, I completely forgot that as tax rates change, people do not shift their level of economic production to account for the change in the tax rate structure. They do not do this so they can benefit the common good, which does not maintain an overall level of equilibrium.

My bad, I'm so silly.

With that said, I'm going to leave this discussion with these final farewells:

Interesting point.

Look at the nominal GDP chart you posted earlier. Notice that ever increasing slope? Here's the same graph in real terms, using chained 2005 dollars:

http://research.stlouisfed.org/fredgraph.png?g=cQG

I would be curious about the slope along diffferent points. For example, 1954-1963 vs 1987 - 1992.


Thinking out loud... Obama and Democrats in Congress wants to raise is raising taxes on households making over $250k MAGI which is about $230k taxable, assuming no itemization (I think a poor assumption, but the easiest to work with).

$230k real taxable income in 2012 gets you a 33% marginal rate.

In 2000 - prior to the Bush tax cuts - it got you a 36% marginal rate.

In 1992, a 31% marginal rate. This was a more regressive tax structure as the top bracket of 31% affected everyone making over about $138k real taxable income.

In 1987, you would have a 38.5% marginal rate. Prior to the Reagan tax cuts of 1986, it would have been 45%.

1975, 53%.

1950, around 43%.

How about comparing growth rate of GDP to the Growth rate of Deficite spending. Note we took on a whole new trajectory for growth of deficits under Reagan. Bush doubled it with his republican congress.

https://www.miataturbo.net/attachmen...l-debt-196-jpg

http://research.stlouisfed.org/fredgraph.png?g=cR7


Argh! All that debt (accumulation of past deficits) really killed economic output! Look at those big surges during the Reagan and Bush years!




Oh. Wait. GDP seems to surge along with the debt. :inout:

Debt seems to surge with Republican administrations. Could it be that GDP growth is paid for with government Deficit spending? No republican would ever admit that but it is what they do when given the chance totally the opposite of what they have all there Republican ditto head voters believing. Seems to be one of the main tenants of Reagonomics, “Deficits don’t matter” as long as you use them to inflate GDP.

Odd how modest tax increases to the upper income brackets under Clinton still produced booming growth on par with any other time in history and the debt growth almost flat lined. Republicans in the house will have none of that however. Got to cater to the so called “Job Creators”.

Nah; that's an oversimplification. However, both Reagan and Bush used fiscal deficit spending (via tax cuts for everyone) to pull the economy out of recession.

Clinton and the Congressional Republicans of the '90s were on a nice path of reducing fiscal deficit spending during boom times (the right time to do so) and then got carried away in their Quixotic quest for balanced budgets and surpluses which drove the private sector in to net deficit spending, one of the main factors leading to the bust that Bush's fiscal deficit spending tried to compensate for.

Please explain this. We still have the Reagan and Bush Tax cuts in effect. We still have recessions with them in effect. Where does it end when every response to anybody whining about how the economy is not doing so well is more tax cuts? And why is it that many times in history the economy has recovered and seen steady growth when tax rates were much higher particularly on the wealthy?

We've lost each other somewhere along the way. If I implied that cutting taxes during recession leads to the end of all future recessions, that was poor communication on my part.

First, some definitions as I use them:

• Aggregate demand: The combined demand for goods and services (stuff) in the economy
• Business cycle recession: A relatively normal occurence where the economy slows down after having "gone up"
• "The Great Recession": The most recent economic slowdown that was a fairly rare combination of a global financial liquidity crisis combined with a household balance sheet recession like we are currently recovering from
• Global financial liquidity crisis: bank lending is the oil that the engine of global economies runs on. When that "dries up," the engine starts to seize
• Household balance sheet recession: After the balanced budget/fiscal surplus of the late '90s, the private sector moved in to a rare position of spending more than they saved, on a total basis (aka private sector deficit). During the Great Recession, corporations quickly cleaned up their balance sheets or went out of business. It's a lot harder for a family of four to lay off the non-income earning spouse and kids and much of their leverage is tied up with their home. It takes households much longer to de-lever (i.e. pay down debt).
• Monetary policy: This is what the Federal Reserve handles, setting interest rates on short-term Treasury and bank lending, which influences interest rates all throughout the economy.
• Fiscal policy: This is what the Congress and President handle. It encompasses primarily taxation and governmental spending.

During a recession, to help speed along recovery as the private sector reduces their spending (taking money out of the economy), there are a few options available:

1. Do nothing and let YHWH, the Flying Spaghetti Monster and Allah sort it out
2. Increase government spending to make up for the reduction in private sector spending
3. Cut taxes, allowing the private sector to keep more of the money it is generating and thus have more available to spend in to the economy
4. Some combination of all of the above

This is to speed along the end of a recession, not to eliminate future recessions from ever occurring again.

From a mathematical perspective, government spending and taxation are equal: cutting spending = raising taxes; increasing spending = lowering taxes. From a practical perspective, I would argue that's not always true as government spending tends to be less efficient than private spending in many (but not all) contexts.


Theoretically, you would want to decrease taxes on everyone (like a full FICA holiday) during recessions and increase taxes on everyone during the boom times. Note that Clinton's tax increases came during a period of reasonably strong positive economic growth (1993) and low capacity slack.

Raising taxes or cutting government spending during slow growth like we have now would be like taking away the crutches from a guy who just had ACL surgery. That is what Japan has been doing with their "start-stop-start" policies. This is what Bernanke's Fed has argued strongly against over the past few years, but the Federal Reserve's monetary policy is less influential at this level than Congressional fiscal policy which is all kinds of dysfunctional.