It turns out that allowing the Bush tax cuts to expire will only hurt people earning more than $300,000 per year. And it appears as if keeping the Bush tax cuts in place would force people earning $60-150,000 to pay slightly more.
Oh those poor Tea Baggers. Pwned again by their corporate overlords. You silly, silly fools.
(h/t, Libby Spencer)
So a local swim club has taken over some of the pools. Volunteers pick up trash in parks. Some — meaning those who can afford it — pay extra to turn on the streetlights in front of their own houses.
The Springs, as locals call it, is a city in transition, a grand experiment in what might happen if a government really does hold the line on taxes — as some citizens demand — and starts curtailing services. No one knows what will result as government shrinks and citizens take up the slack.
Will wealthy neighborhoods thrive, while poor areas decline further? Will crime rise as cops go missing? Will charity transform Colorado Springs into a libertarian paradise?
Or will it be a colossal flop?
I think I know the answer. It seems to me we’ve been down this road before, many times. It seems to me that Americans are really, really bad at remembering their history. Will charity transform Colorado Springs into a libertarian paradise? Charity has never, ever been able to shoulder the burden of providing public services, not equitably and not over the long haul. For hundreds of years charity was supposed to do this and there’s a damn good reason we stopped relying on charity: it didn’t work. There’s not enough. It ends up being inequitable. Wealthy neighborhoods get the goodies, poor neighborhoods do not.
Wealthy people don’t bear the brunt of these cuts, the poor do:
"I was working up north in a little diner, and I had to quit because of the bus," said Joseph Williams, 18, while waiting for a Mountain Metro last week.
Added fellow passenger Rashad Lindon, 20: "There are times I have to work late, and I have to put $20 in people's gas tanks to get around. It's a pain — from having to pay $1.75, to paying $35 for a taxi, or getting somebody to pick me up."
Next, safety may become a concern. The city fire department is down 20 firefighters this year; the police department has 42 fewer cops on the streets. For both fire and police, there are no classes of recruits in training, which is unusual.
"In the last year and a half, we went from being a proactive, problem-solving to a reactive police department, to where we only go when we are called," said Pete Tomitsch, president of the Colorado Springs Police Protective Association.
"There is a lot of frustration within the department. There is a whole slew of calls we don't respond to that a year and a half ago we did."
In Libertarian Paradise, the wealthy always do well. Getting around town is never a problem because you own a car, and insurance, and mobility opens you to opportunity. The wealthy can hire private security companies to patrol their gated communities. They don’t need to go to the public swimming pool because they have private swimming pools, either at the country club or in their backyard. They can pay to have the streetlights turned on Privilege Drive whereas someone on Unfortunate Avenue cannot. Relying on charity creates Separate and very, very Unequal:
Not every neighborhood in the city, though, is streetlight- stingy. Nor is every median brown, or each park without trash cans.
So far, about 900 lights have been "adopted" by Colorado Springs residents — a fee was paid, and the light was turned back on.
In some cases, services can be restored through volunteer labor. Residents adopted more than 100 trash cans in parks by agreeing to empty them.
But which parks and which community centers will stay active? That depends on where individuals or groups are willing to step up. And private enterprise means higher fees.
Three public pools formerly run by the city are now operated by Colorado Springs Swim School, a private swim club that agreed to take on a five-year contract. Rates have gone up. Family admission at Wilson Ranch pool, for example, has vaulted from $10.50 to $20.
The swim club's efforts are surely community-minded.
"We just couldn't let it happen," said Tina Dessart, the owner of the swim school. "Our focus has been learn to swim for a long, long time. When pools shut down, drownings increase."
But the escalating costs for residents, along with other aspects of the budget cutting, are unfair, said City Councilwoman Jan Martin, who grew up in Colorado Springs.
"These medians and parks that are being adopted are in wealthy neighborhoods," she said. "We are seeing the creation of a community of haves and have nots."
Nobody could have anticipated that!
But an examination of the American tax code indicates that oil production is among the most heavily subsidized businesses, with tax breaks available at virtually every stage of the exploration and extraction process.
According to the most recent study by the Congressional Budget Office, released in 2005, capital investments like oil field leases and drilling equipment are taxed at an effective rate of 9 percent, significantly lower than the overall rate of 25 percent for businesses in general and lower than virtually any other industry.
And for many small and midsize oil companies, the tax on capital investments is so low that it is more than eliminated by various credits. These companies’ returns on those investments are often higher after taxes than before.
When your return on investment is higher after taxes, that's what I call a giveaway.
Here’s the part I love:
The American Petroleum Institute, an industry advocacy group, argues that even with subsidies, oil producers paid or incurred $280 billion in American income taxes from 2006 to 2008, and pay a higher percentage of their earnings in taxes than most other American corporations.
Um, so? So what? You're supposed to pay twice or three times what you do, but you want a lollipop for paying something? What, are we supposed to say thank you? Sorry dudes, that’s not how it works. Oil companies are insanely profitable. So pay what you owe and shut up.
You know, one thing I really can’t stand is hearing how solar and wind energy simply are not competitive. Right. Let’s give renewable energy the same tax deal that oil gets, ‘mmkay? And while we’re at it, let’s factor in the true cost of fueling our economy on dead dinosaurs. Let’s include the cost of the environmental damage from air pollution and climate change and oil spills. Don’t forget the $167 billion a year we spend on war to secure our access to oil in the Middle East.
Here is something worth considering:
Some of the tax breaks date back nearly a century, when they were intended to encourage exploration in an era of rudimentary technology, when costly investments frequently produced only dry holes. Because of one lingering provision from the Tariff Act of 1913, many small and midsize oil companies based in the United States can claim deductions for the lost value of tapped oil fields far beyond the amount the companies actually paid for the oil rights.
Once upon a time, oil was a new technology and the American government felt it worthwhile to encourage this nascent industry with tax incentives and tax breaks. That was a long, long time ago but it's generally how we do things. But oil is no longer a new technology, it's now the big bully on the block. Other nascent industries are coming up and the American government should be encouraging these energy technologies with comparable tax incentives and tax breaks. But any attempt to do so is met with manufactured outrage from people like the American Petroleum Institute. We have to fight tooth and nail for the smallest crumbs, and it's not anything close to comparable to what Big Oil gets.
It's time to demand some parity here.
Only 12 percent of the public say that the Obama administration has lowered their taxes since coming to office, despite the fact that the White House's stimulus package cut taxes for 95 percent of Americans, a new opinion survey found.
Here’s the poll. Not surprisingly, Tea Partiers were most likely to think Obama has raised their taxes, when in fact most have received a tax cut.
That certainly shows you the power of the right wing message. That’s some powerful Kool-Aid, blessed by Frank Luntz, spread by Dick Armey, and swallowed whole by a bunch of clueless idiots so desperate to hate on a Democratic president that they will believe anything they’re told.
Personally I'm not a fan of tax cuts, when our taxes are already at historic lows.
“Due to budget restraints, we will not be mailing a courtesy reminder as we have in the past in the month of February. This will be the only statement you will receive for the 2009 tax year.”
Really? That’s the “fat” we’re trimming from the budget--sending a second property tax bill? This is on top of Metro Public Works cutting their mowing program this summer. And let me say, trying to cross Granny White Pike at Gale Lane has been a dangerous proposition when the grass is knee-high.
Even more alarmingly, Putnam County, TN, is in such dire straights it has considered doing away with county primary elections:
COOKEVILLE, Tenn. -- Putnam County is looking at the prospect of eliminating primary elections in hopes of saving $60,000.
On Monday night, the county commission voted 14 to 9 to ask the county parties to forgo primary elections and select candidates through private caucuses.
Primary elections are historically low-turnout, but nonetheless canceling an election for fiscal reasons sets off alarm bells with me. You tea party folks yammering about your loss of freedoms might want to consider what it means to cancel an election because the county doesn’t have the funds to stage it.
Then again, will our moribund electorate even notice?
It’s only a matter of time before this fiscal starvation starts costing people in other ways. Up in Michigan, the state budget situation is so sorry, they’ve had to stop safety inspections of school buses:
"It's not a good thing, but it's a budget reality," LeBlanc said. "I'm not sure there are viable alternatives."
I guess the free hand of the market is supposed to protect Michigan kids on their way to school from now on.
Could this happen in Tennessee? We’ve already dumped another 84,000 people from TennCare. Now the state legislature says it will permanently slash $1 billion from Tennessee’s state budget. The reason is lower revenue, but the Republican legislature thinks this is a good way to operate state government:
“I really think you need to expect and can treat these $1 billion to $1.1 billion in base reductions ... as permanent,” said Jim White, executive director of the legislature’s Fiscal Review Committee, told House leaders on Thursday. “State government is going to be smaller and different after we complete this budget year.”
Well, that’s a great talking point and it sure looks good in the press release, but how does that look in practice? Not so good, it seems:
After more than two hours of grim assessments Thursday, House Speaker Emeritus Jimmy Naifeh, D-Covington, had enough. He predicted the state’s Rainy Day Fund, once at $750 million and projected to fall to $323 million in 2010-11, “is probably going to go down to zero.”
He called the removal of some TennCare recipients “heartbreaking” and said lawmakers are to blame. He also urged colleagues to look at a tax increase.
“No one has got the backbone or the guts to talk about revenue enhancement,” Rep. Naifeh complained. “That’s what we need to at least explore.”
Nope, no one has the guts or backbone, not the Republicans and not the Democrats. But it’s pretty irresponsible to view your “rainy day fund” as budgetary fat.
People are so disconnected from the services that government provides that no one notices the hypocrisy of fiscal conservatives calling for ballot initiatives over stuff like English Only and do we need a new convention center. You know, that's all very well and good but it costs money to open up the polling places and count all of those votes. Who’s gonna pay for it?
Conventional wisdom holds that tax increases during a recession are a sure way to prolong the misery. Maybe now isn't the time, but eventually we're going to have to repeal those Bush tax cuts which helped no one but the super wealthy. Didn't see any of that trickle down over the past eight years, either.
Yesterday I heard Thom Hartmann advocate a 50% tax on people making $3 million+. Rather than hurt “small businesses,” he said, it would actually grow the middle class because business owners would funnel their profits back into their businesses instead of taking home big salaries to be spent on European vacations and yachts.
Here's a handy-dandy chart of Top U.S. Federal marginal income tax rate from 1913 to 2009:
Our tax rates are among the lowest they've been in the past 100 years. Are people better off? No. Has the "Laffer Curve" fulfilled its promise of increasing revenue? No it has not. Instead we're cutting safety inspections of school buses, using up our rainy day funds, and talking about cancelling elections because governments can't afford them.
It's time for someone to be a grown up and talk about what it means to operate a state budget without a safety net.
At least he's asking for actual charity rather than expecting the government to come to his rescue at taxpayer expense.
This is such a common refrain among conservatives: “Why should my money pay for his/her/your/their [fill in the blank] ...”
Well, there are a lot of reasons why. For one thing, it’s not in the nation’s best interests to have large numbers of poor, starving, homeless, sick, uneducated, [fill in the blank] people in our communities. It’s a security issue, it’s an economic issue, and it’s a quality of life issue. And the most efficient way to handle this is through taxes which pay for social services. Relying on charity, as has been observed in the past, denies the constant of human nature: greed.
And for people of faith, it’s a moral issue. I wrote about the morality of taxes back in 2007. And now I direct you to one of my favorite faith bloggers, The Search for Integrity, which has been on my blogroll since almost day one. He has something to say about the theology of taxes:
On whether taxpayers have responsibility for the well-being of their neighbors, by means of government programs:
In the theocratic state envisioned by the Hebrew prophets (or even, in their critique of every nation) the responsibilities of kings was clear: plead the cause of the fatherless and widow, demand justice for the poor. See, for example, Psalm 82:3-4: Defend the cause of the weak and fatherless, maintain the rights of the poor and oppressed. Rescue the weak and needy; deliver them from the hand of the wicked. Nations were judged by how well their rulers implemented these simple principles.
In the United States of America, “we the people” (the voters and, yes, the taxpayers) are sovereign. Therefore “we, the people” are under divine judgment if we fail to use our sovereign power to take care of the elderly, the disabled, the orphan and widows of our world. “We, the people” as sovereign refers to our corporate role as king, which is to say, the government. It is laudable for individual persons to do what they can by means of “charity,” but “we, the people” are not just an aggregate of individual persons. We, together, are king, and as such are answerable to God for how well we rule.
Okay, usually I save the religious stuff for Sundays but it seems timely in light of the arguing about healthcare that’s taking place right now. The theological argument probably won’t mean much to most of the folks who visit this blog but it means something to me and it’s important element to the whole healthcare debate. Healthcare is a moral imperative and it’s an ethical issue. It’s why, as CNN has finally noticed, faith groups have joined the chorus for healthcare reform.
The moral argument isn't one we hear much of in this debate. That's curious, because our news media has not hesitated to trot out fundiegelical wackadoodles every time they need to present their idea of "modern American Christianity" on issues like gay marriage. But when it comes to a real moral issue--a war, say, or healthcare for all--suddenly people of faith aren't deemed relevant to the conversation.
Odd.
My friend Therevr offers a very concise Biblical interpretation in defense of government programs like healthcare and welfare. Conservative faith groups like the Family Research Council which oppose healthcare reform offer nothing but lies about government-funded abortion and other fearmongering. That's not very Biblical to me, but it's about what I've come to expect from the Religious Right.
Drug companies get a TAX DEDUCTION for running ads for their drugs. Is this true of Frosted Flakes? Audi? Xerox? Does any other company in America get subsidized for airing commercials to get America to buy their products? It's not "significant money," though, so ending this direct payout from taxpayers to drug companies got shelved.
Not significant money? In 2004 drug companies spent $4 billion on direct to consumer advertising.
Set aside for a second the hypochondria that a nightly barrage of ads telling you that you have restless leg syndrome or iron-poor blood or any of a thousand ailments induces. Set aside the self-medication and the boiling down of complex medical issues into 30-second spots showing couples running through a field. Set aside how drug ads increase demand for medications and thus the costs. Set aside that some of these ads run before the Food and Drug Administration even completes their studies of the side effects. You mean to tell me that I'm helping PAY for these things, too?
If “my tax dollars” are going to go somewhere, it sure as hell better not be to help a gazillion billion dollar industry pay to promote its product.
I still can’t believe this. I'm thinking it has to be a mistake.
[UPDATE]: dday has since learned that the deduction is as a business expense, not a straight tax deduction. That certainly changes the outrage factor on the tax issue. But I agree that direct to consumer marketing of pharmaceuticals is a really, really, really bad idea that should never have been allowed to begin with and probably should be repealed.
But it probably won't be repealed, ever, because have you seen how many freaking pharmaceutical ads are on CNN and MSNBC and the other networks these days? Not to mention the three and four page ads in magazines and newspapers, filled with all of that fine print about how you might die of oily anal discharge from your weight loss pill? If the mainstream media loses that revenue they're screwed. Since they have a dog in this fight, expect them to pull out all the stops to make sure the cash river keeps flowing.
Just a hunch.
Northern Europeans pay some of the highest taxes in the world. Danes pay about two-thirds of their income in taxes. Why be so happy about that? It all comes down to what you get in return.Well, that’s certainly interesting. I can already hear the howls of protest from the folks over at Tennessee Free: “I’m quite certain taxes won’t make me happier, you Socialist! You go ahead and pay them if you want!” I love that argument. Taxes only work if everyone pays them, you dufuses.
The Encyclopedia of the Nations notes that Denmark was one of the first countries in the world to establish efficient social services with the introduction of relief for the sick, unemployed and aged.
It says social welfare programs include health insurance, health and hospital services, insurance for occupational injuries, unemployment insurance and employment exchange services. There's also old age and disability pensions, rehabilitation and nursing homes, family welfare subsidies, general public welfare and payments for military accidents. Moreover, maternity benefits are payable up to 52 weeks.
Simply, you pay for what you get. Taxes in the U.S. have taken on a pejorative association because, well, we are never really quite sure of what we get in return for paying them, other than the world's biggest military.
Healthcare and other such social services aren't built into our system. That means we have to worry more about paying for things ourselves. Worrying doesn't equate to happiness.
Mar 16th, 2009 | COLUMBIA, S.C. -- South Carolina Gov. Mark Sanford is calling on President Barack Obama to get the Democratic National Committee to pull an ad criticizing the Republican's opposition to federal stimulus money.
In a statement Monday, Sanford said the ad is at odds with Obama's campaign promises of ending politics as usual.
The DNC is airing an ad that says Sanford is playing politics with $700 million in stimulus cash instead of using it for health care, jobs and schools. Sanford last week asked Obama to allow the state to use some of the stimulus money to pay down state debt.
Oh, whaah. Politics as usual, huh? South Carolina has the second highest unemployment in the nation at 10.4%, right behind Michigan:
The commission said the number of people without jobs in South Carolina climbed to a record high of 227,986 in January and its data also indicated that for the first time in almost a year the labor force contracted.
I'm just curious how paying down the state debt at a time of high unemployment will help unemployed families. How is this going to put food on the table, pay the rent, or help someone find a job?
It gets worse:
Amid forecasts of a feeble summer of tourism, the state's largest industry, some economists are predicting South Carolina's unemployment rate will hit 14 percent.
Before federal bailout money, the state had to cut $1 billion from a $7 billion budget because of a drop-off in tax revenue. Government workers have been ordered to take unpaid days off. About 135,000 people are collecting some $20 million a week in unemployment benefits, and the state is borrowing federal cash to foot the bill.
Job fairs draw hundreds more applicants than the number of positions available. Food pantries run short of food.
Republican Gov. Mark Sanford is a leading critic of federal stimulus money and is pushing to use the cash over which he has some say to pay off debt. State lawmakers plan to fight him on that. Sanford instead has called for tax cuts to help the economy.
I’m trying to wrap my head around this. The state has been forced to cut its budget because of decreased tax revenue, and must therefore borrow money from the Federal government to pay for unemployment benefits. Meanwhile, unemployment is rising.
So I’m trying to see how tax cuts will further help people in South Carolina. It will certainly create an even bigger budget shortfall for the state. And the governor wants to take a couple of hundred million dollars in federal money and instead of giving it to the people of the state, its intended use, he wants the state to keep it to pay down debt.
Dear friends in South Carolina, I'm sorry you are suffering under this idiocy. Just remember: if the Christian Exodus movement has its way, things will only get worse.
• I have a friend who is planning to not work overtime this year to stay well below the dangerous benchmark that is 250k. His point was that he might as well take some time off and enjoy and relax rather than work and give every dollar above 250 away. I don’t blame his reasoning and the loss is, he spends his money.
The argument is so compelling, it piqued the interest of a reporter at ABC News, who filed this report:
A 63-year-old attorney based in Lafayette, La., who asked not to be named, told ABCNews.com that she plans to cut back on her business to get her annual income under the quarter million mark should the Obama tax plan be passed by Congress and become law.
"We are going to try to figure out how to make our income $249,999.00," she said.
"We have to find a way out where we can make just what we need to just under the line so we can benefit from Obama's tax plan," she added.
"Why kill yourself working if you're going to give it all away to people who aren't working as hard?"
Of course, the “little people” doing things like caring for your kids, cleaning your office, providing your nursing care, educating your children, etc. etc. don’t “work hard.” Oh, the arrogance, the sense of entitlement from these pockets of "real America." It's astounding!
There’s more:
Dr. Sharon Poczatek, who runs her own dental practice in Boulder, Colo., said that she too is trying to figure out ways to get out of paying the taxes proposed in Obama's plan.
"I've put thought into how to get under $250,000," said Poczatek. "It would mean working fewer days which means having fewer employees, seeing fewer patients and taking time off."
Poczatek argued that by reducing her income from her current $320,000 to under $250,000 by having her dental hygienist work fewer days and byl treating fewer patients, she would avoid paying higher taxes on the $70,000 that would be subject to increased taxation if Obama's proposal is signed into law.
These must be the dumbest bunch of wealthy Americans ever because “Going Galt” to stay below $250,000 in income is just wrong. Like, really, really wrong. As in, factually incorrect:
Now, the obvious here is that the tax code doesn't work that way. A tax increase effects the marginal dollar that a person gains. That's means only every dollar over $250,000 is taxed at a higher rate. Obama is not proposing a tax system whereby somebody who goes from $249,999 to $250,000 suddenly becomes poorer. Nobody has ever enacted a tax hike like that in the history of the United States.
So, Poczatek will still end up far better off paying a slightly higher tax on that $70,000 than if she didn’t earn the $70,000 at all. I mean, how dumb can you get?
There’s a lot of factually incorrect information swirling around out there about Obama’s tax plan. Yesterday morning a friend told me he has a wealthy client who said Obama was going to eliminate the deduction for charitable contributions. “Gee,” I replied. “If that were true, you’d think we’d have heard about that.”
Sure enough, it’s another piece of wingnut misinformation. The president’s tax plan does not eliminate charitable deductions, but caps them at 28% AGI for top-income earners. This levels the playing field for the 95% of us who are not named Frist or Gates who like to donate to charities, too:
If you’re a teacher making $50,000 a year and decide to donate $1,000 to the Red Cross or United Way, you enjoy a tax break of $150. If you are Warren Buffet or Bill Gates and you make that same donation, you get a $350 deduction – more than twice the break as the teacher.
This proposal walks that difference back some of the way – it would limit the tax benefit for Buffet or Gates to $280. In other words, we are not eliminating the deduction – just reducing it to 28 percent (or $280 on the hypothetical $1,000 contribution) for the 5 percent of families at the very top of the income distribution. That is the same tax benefit that they would have enjoyed at the end of the Reagan Administration.
There’s a lot of ignorance out there about taxes and tax proposals, and that’s understandable -- taxes are a complicated issue. All the more reason why news outlets should be extra careful when doing their reporting.
Accompanied by a retinue of advisers, she took a seat at one end of a conference table and listened passively as Gary Stevens, the president of the Alaska Senate, a former college history professor and a low-key Republican with a reputation for congeniality, expressed delight at her presence.
Would the governor, a smiling Stevens asked, like to share some of her plans and proposals for the coming legislative session?
Palin looked around the room and paused, according to several senators present. "I feel like you guys are always trying to put me on the spot," she said finally, as the room became silent.
Dang, and Katie Couric wasn’t even anywhere nearby.
Perhaps Palin is a little oversensitive because of this:
The rapid decline of oil prices has left the state in a looming budget crisis and a late-entrant in the national recession. And that could have political repercussions for the former Republican vice presidential hopeful, who has signaled an interest in a 2012 presidential run but must stay visible in the Lower 48 to be successful.
[...]
Oil accounts for as much as 90 percent of state revenues. So the plunge of North Slope crude from an all-time high of $144.59 per barrel last July threatens to give the state an estimated budget shortfall of up to $1.5 billion in the fiscal year that ends June 30.
Palin bills herself as a fiscal conservative and has called for reducing state spending by $268 million in this budget year, but lawmakers and others say these aren't reductions at all and do nothing to curtail spending. For example, the bulk of that sum -- $200 million -- is unspent tax credits for companies investing in oil and gas development that are being returned to the treasury.
We all knew that Gov. Palin’s “Alaska miracle” was built on a whole mess of false assumptions which no one in the national media ever bothered to address.
No one could have predicted this. Oh, wait. Never mind.
“Right now, given the concerns that we have over the size of this package and all of the spending in this package, we don’t think it’s going to work,” the House Minority Leader John A. Boehner, Republican of Ohio, said on NBC’s “Meet the Press.” “And so if it’s the plan that I see today, put me down in the no column.”
While the plan can potentially pass the Democrat-dominated House without Republican support, it will continue to face opposition when it comes before the Senate, said Senator John McCain of Arizona, speaking on “Fox News Sunday.” At least two Republicans will need to approve the bill for a filibuster-proof majority vote of 60.
Senator McCain, who lost the presidential election to Mr. Obama in November, said that he planned to vote no unless the bill were changed.
“We need to make tax cuts permanent, and we need to make a commitment that there’ll be no new taxes,” Mr. McCain said. “We need to cut payroll taxes. We need to cut business taxes.”
McCain ran on making the Bush tax cuts permanent--those tax cuts to the wealthiest Americans--and he lost. Clearly Americans are smart enough to know that it’s time for John McCain’s friends to start toting their share of the load, because “trickle down” never does seem to make it much further than a pool of the privileged.
Furthermore, none of you idiots gave a damn about “spending” on things like the Iraq War and Guantanamo Bay. Every time Bush had his hand out for more money for war you were happy to sign the blank check.
So I have a steaming cup of STFU for the Republican Party right now.
A few weeks ago I started to work on a post about the New Deal and then put it aside. But now would be a good time to post a few of those salient points.
• Number one: In a recent op-ed piece, Nobel-prize winning economist and New York Times columnist Paul Krugman reiterated the point that dollar-for-dollar, tax cuts do not stimulate the economy as well as government investment:
The Romer-Bernstein report acknowledges that “a dollar of infrastructure spending is more effective in creating jobs than a dollar of tax cuts.”
I realize this will initiate brays of protest from the Heritage Foundation and American Enterprise Institute folks who keep touting the idea that tax cuts are the best way to stimulate the economy. The fact is, those people have been in charge during this economic crisis, they were in charge during the Reagan years, and it seems to me every time they are put in charge and give their wealthy buddies big tax cuts, all we’re left with is a ruined economy which a Democrat has to try to save.
So, let’s ignore the Heritage Foundation, the Cato Institute and the AEI for a while, shall we?
• Number Two: The GOP talking point that the New Deal failed and it was really World War II that saved America’s economic bacon is laughable rewrite of history. For one thing, it overlooks the fact that when America entered WWII, President Roosevelt took over the entire American production system, retrofitting American factories for a war footing, and putting American consumers on strict rationing. It was a nationalized production system that would strike terror in the hearts of conservatives today.
It’s hard to imagine that amount of government intervention and control over production and consumption under any circumstance other than the needs of war. So if that’s your idea of what pulled America out of the Great Depression, fine -- but you’re giving a ringing endorsement to the greatest government intervention in private enterprise in American history.
• Number Three: Adam Cohen attacks the GOP talking point that the New Deal failed with this point:
The anti-New Deal line is wrong as a matter of economics. F.D.R.’s spending programs did help the economy and created millions of new jobs. The problem, we now know, is not that F.D.R. spent too much priming the pump, but rather that he spent too little. It was his decision to cut back on spending on New Deal programs that brought about a nasty recession in 1937-38.
The second problem is that the criticism overlooks the relief Roosevelt’s programs brought to millions. When F.D.R. took office, unemployment was 25 percent, and families were losing their homes, living in shantytowns, even fighting one another for food at garbage dumps.
The difference that the Civilian Conservation Corps, the Works Progress Administration and other New Deal public works programs made in people’s lives is incalculable. Congressional Republicans say Mr. Obama’s stimulus will cost too much, and that over time the economy will cure itself. When critics raised the same objections to F.D.R.’s programs, his relief administrator, Harry Hopkins, had a ready answer: “People don’t eat in the long run. They eat every day.”
I’ve heard that same “over time” remark from modern-day conservatives: “We’ll muddle through somehow, we always have,” is what one conservative told me.
I’d say that remark comes from someone who is not facing the reality of being evicted because they are three months behind on their rent and they just lost their job last week. I got a call from a lady last week who told me that story; she was calling me because of my work with a non-profit that assists the working poor. There are thousands like her. So no, “muddle through somehow” doesn’t cut it for this lady and millions like her.
Anyway, I bring this all up as a reminder to the Democrats in Congress that they were sent a clear message in the last two elections. We want change. We need new policies. We do not need to listen to the same tired voices yammer the same tired lines about the need for “making the tax cuts permanent.” We’ve been hearing that for years.
The Republicans had their chance. Their policies failed. They drove this nation into a ditch. It’s time to do something new.
Thanks to George W. Bush and a complicit Congress, we currently spend $1.5 billion a year to fund abstinence-only until marriage sex education in our public schools. And yes, that money goes to people like Derek Dye, as he is employed by the Elizabeth New Life Center that received a $800,000 CBAE grant in 2007 to promote abstinence until marriage. His qualifications? A “Bachelor of Fun Arts” from Barnum Bailey Clown College, and an abstinence educator certification that can be purchased for $50.
ThinkProgress has a YouTube clip of Dye’s act. His basic message seems to be, if you have sex before you’re married, smoke, drink or use drugs, your life will be ruined. And balancing a ladder on his chin and juggling machetes is supposed to illustrate that somehow.
I don’t get it. This message is supposed to be stronger than raging teenage hormones? Get real, people.
Despite the dramatic nature of the Fed's move, some economists questioned whether it will have much effect on the economy. They said the problem for consumers and businesses right now is not the cost of borrowing, but the availability of credit and the weaker economic fundamentals.
"Lowering rates to this level is purely a psychological move made to send the message that the Fed is committed to righting the sinking economic ship," said Rich Yamarone, director of economic research at Argus Research. He noted the previous rate cuts did little to stop home and auto sales from plunging.
Uh, yeah. I don’t know who these “psychological moves” are directed at but they certainly don’t make me feel any better. When the government starts giving banks free money I start to get that panicky feeling that maybe we’re in even worse trouble than they’re telling us.
My Wingnut Friend ® writes:
When is someone going to quit focusing on avoiding a Depression and instead focus on cutting taxes, limiting government, and letting the market work so that we will have a Surge instead?
No, it’s not a parody. There really are people who have learned nothing from the past eight years.
Remember that definition of insanity?
For the record, John really is a friend of mine. Other than having completely boneheaded ideas about public policy, politics, race relations, the women’s movement, the environment, religion, and just about everything else that matters, he’s actually a very nice guy. This means we end up talking about books a lot, which is fine since we are in a writer’s group together. He’s one of the most talented fiction writers I know, and I never understood how someone so smart could at the same time be so dumb.
But he’s not alone in his ideas. There are plenty of boneheaded folks around here who seem to think if only we’d implement more tax cuts and decrease government oversight to allow the free hand of the market to run rampant make everything peachy, all would be well. It’s a core value in Wingnuttia and while it’s been proven wrong time and again, some folks just won’t let it go. I can’t blame them: it’s been the core principle of the Republican Party for over 25 years, it would be sorta embarassing for them to come back now and say they had "found a flaw” or something.
Anyway, here’s something I pulled out of the memory hole:
• In 2008, taxes would be cut from 10 percent to zero percent on the first $6,000 dollars of taxable income for individual taxpayers and the first $12,000 of taxable income for couples. Taxpayers could receive rebates of up to $600 for individuals and $1,200 for couples. A minimum of $300 per person and $600 per couple would be available to those with at least $3,000 of earned income. This relief would be available to everyone with adjusted gross income less than $75,000 for singles and $150,000 for married couples filing jointly. It will be phased out for taxpayers above those income thresholds.
• Everyone eligible for this relief would also receive an additional $300 per child. For example, this would mean up to $1,800 of tax relief for an eligible couple with two children.
Epic fail of additional tax cuts! We all got our “economic stimulus” checks in the mail and the economy tanked anyway. Oh noes. So let’s give even more tax cuts on top of the ones Bush implemented in 2001 and 2003, maybe that will do something! Hey I know, maybe the government could just give away free money, let’s see if that helps!
Oh, wait.
As far back as 2003 some folks were saying that tax cuts at war time were the problem, not the solution:
Economic growth, though positive, has not been sufficient to generate jobs and prevent unemployment from rising. In fact, there are now more than two million fewer private sector jobs than at the start of the current recession. Overcapacity, corporate scandals, and uncertainty have and will continue to weigh down the economy.
The tax cut plan proposed by President Bush is not the answer to these problems. Regardless of how one views the specifics of the Bush plan, there is wide agreement that its purpose is a permanent change in the tax structure and not the creation of jobs and growth in the near-term.
The permanent dividend tax cut, in particular, is not credible as a short-term stimulus. As tax reform, the dividend tax cut is misdirected in that it targets individuals rather than corporations, is overly complex, and could be, but is not, part of a revenue-neutral tax reform effort.
Passing these tax cuts will worsen the long-term budget outlook, adding to the nation’s projected chronic deficits. This fiscal deterioration will reduce the capacity of the government to finance Social Security and Medicare benefits as well as investments in schools, health, infrastructure, and basic research. Moreover, the proposed tax cuts will generate further inequalities in after-tax income.
Well, pay no attention to the Nobel Laureates, what do they know?
I’m no economics whiz-bang but it seems to me the flaw here is one that’s been not just years in the making but decades in the making. I think it’s a little crazy that we have a consumption-based economy. That might have been well and good as the country raised its standard of living and we were buying things that we also manufactured here, but right now our consumption only benefits the people of China, India, Vietnam and Mexico. On top of which, we’ve reached a point where people pretty much have everything they need.
We should have seen this coming when everyone started building bigger and bigger homes -- twice and three times as large as the ones most of us grew up in. Let’s face it, these are consumption boxes. Bigger homes mean you need to buy more stuff. But when the economy gets tight you can live very comfortably in a smaller home and make do with your old stuff. Sooner or later this was going to catch up with us.
Instead of basing our economy on how much stuff people buy which they don’t need, how about basing the economy on creating jobs? On how many people are working? People need jobs, they don’t need new flat-screen TVs made in Taiwan.
We’ve been down a bumpy road for the past five years. The stock market has been a roller coaster ride for far longer than the past three months. I wonder if the local “dumbasses” who kept insisting we are not in a recession are ever going to admit the resot of us were right, now that the National Bureau of Economic Research says the recession actually began a year ago.
I think it’s time we stopped listening to people who have always been wrong and start listening to the folks who were right for a change. Our economy is FUBAR’d and it’s not going to get any better as long as we fail to recognize that the world has changed and old tactics like lowering interest rates and tax rebates are not going to work.
The sad truth of the last two two-term Republican presidents is that their economic premise, the key part of their economic game plan, simply has not done what it’s supposed to do.
That is, cutting taxes, especially on upper-income Americans, does not generate so much economic activity that it replaces all the lost I.R.S. take and then some. At least those have been the results so far.
Trickle-down is an enduring conservative fantasy but it doesn’t exist. Tax-cuts are a dishonest economic policy because conservatives are also all about increasing defense spending and growing the government, despite what they will tell you. As Stein notes, you can’t have both:
Mr. McCain wants to extend many of President Bush’s income tax cuts and to reduce taxes on corporations. But the facts of life are that we have a large budget deficit, even though some other nations have even larger deficits as percentages of gross domestic product. We have to pay interest on it. As a people and a nation, we owe this money in large part to foreigners — and that can have political implications. The facts of life are that federal spending is almost all untouchable: the military, Social Security, Medicare, interest on the debt, pensions. The discretionary part is tiny.
Every category of federal spending is likely to grow. This means that if we don’t raise taxes, if we keep doing what we’re doing, the immense deficits and debt will not go away — and will probably grow.
The question is simply this: Do we want to step up to the plate like responsible people — I hate to say this, but the last responsible people who actually did this were named Bill and Bob (Clinton and Rubin) — and shoulder our responsibilities? Or do we just kick the can down the road a bit and leave the mess for our children and their children?
And if we do raise taxes, should people who are barely getting by pay them or should people who are getting by very nicely pay them?
Good question.
It’s nice to see someone from the conservative world step up and be an adult, doing some honest truth-talking instead of telling us what we want to hear.
Ben Stein is right. You cannot “starve the beast.” All you can do is pass the bill along to the next generation. That’s been the policy of Bush II. But it is neither sound economic policy nor responsible.
And now McCain is touting more of the same?
Stupid.
Newsweek is set to publish a highly embarrassing report on Sen. John McCain, revealing that the McCains have failed to pay taxes on their beach-front condo in La Jolla, California, for the last four years and are currently in default, The Huffington Post has learned.
Under California law, once a residential property is in default for five years, it can be sold at a tax sale to recover the unpaid taxes for the taxpayers.
The McCains own at least seven homes through a variety of trusts and corporations controlled by Cindy McCain.
Meanwhile, let's not forget McCain's tax-free disability pension. Taxes, schmaxes! They’re for the little people!
And this is the guy we’re supposed to trust with our economic policy? This is the guy who’s going to enforce fiscal discipline and end pork barrel spending? He can’t even keep his own financial house in order!
Hilarious.
Cue the phony outrage over how Newsweek got tipped off to this story in 5 ... 4... 3...
Even with gasoline prices averaging $2.50 a gallon, there's little demand in the United States for such subcompact cars as the Chevrolet Aveo, said Catherine Madden, a senior analyst with Global Insight.
Gas prices would have to rise to $4 a gallon and remain there for a year to spur demand for subcompacts, Madden said.
"There's not a lot of indication that Gen Y is going to jump into the subcompact segment," Madden said.
GM sold 68,000 Chevrolet Aveos in the United States last year. Demand is much stronger for compact and subcompacts in Mexico and South America.
Yes, that’s the brilliant thinking that has Toyota in a dead heat with GM to be the world’s top automaker. Meanwhile, Honda and Nissan had sales increases this quarter, while Ford and GM continue to tank.
Way to go, Ford and GM. And we’re supposed to bail out these clowns with $40 million in tax breaks this year? Whatever happened to the "free hand of the market"?
We’re long past the days when the old adage ”What’s good for the country is good for General Motors, and vice versa” rings true. Because these companies no longer care about what’s good for the country (if they ever did). They care only about what’s good for their bottom line, and right now that happens to be good for Mexico and India--not so good for America.
When will we stop rewarding these corporate giants whose business policies do not benefit American workers?
Bush has requested $603 million to train Iraqi police. But at the same time, his FY 2009 budget includes a 61 percent cut for state and local law enforcement programs at the Justice Department.
Mikulski is rightfully outraged at the elimination of the COPS and Byrne grants, which provide federal funds for local law enforcement in places like Nashville. Bush’s budget eliminates these domestic programs completely, yet he wants $603 million to train Iraqi police?
Here’s a radical idea for the president: you want tax money to train the Iraqi police? You want taxpayers to fund more surges? You want more money for your war? Then ask the American people to pay a war tax.
Go on, I dare you. I double dare you.
Take it straight to the American people. What, are you scared we’ll say no? Maybe we’ll surprise you: with only one exception (in the 1840s), taxes have been raised to fund every single war America has ever fought. Until now.
So go on, ask us. If we say no, we'll pack up our bags and go home. If we say yes, then you have your "war mandate."
Just don’t bleed the homeland dry to pay for Iraq. Don’t rob America.
That's just stupid.
