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LWW
07-09-2011, 09:26 AM
... an editorial on the debt ceiling discussions that is hyperventilating moonbattery:

<div class="ubbcode-block"><div class="ubbcode-header">Quote:</div><div class="ubbcode-body"><span style='font-size: 26pt'><u>An Establishment in Panic</u></span>
By Pat Buchanan

By refusing to accept tax increases in a deal to raise the debt ceiling, <span style='font-size: 11pt'>Republicans are behaving like "fanatics," writes David Brooks of The New York Times.</span>

<span style='font-size: 11pt'>Anti-tax Republicans "have no sense of moral decency," he adds.</span>

<span style='font-size: 11pt'>They are "willing to stain their nation's honor" to "worship their idol." If this "deal of the century" goes down, as he calls the Barack Obama offer, "Republican fanaticism" will be the cause.

"The GOP has become a cult" that has replaced reason with "feverish" and "cockamamie beliefs," writes Richard Cohen of The Washington Post. The Republican "presidential field (is) a virtual political Jonestown,"</span> the Guyana site where more than 900 followers of the Peoples Temple drank the Kool-Aid that Rev. Jim Jones mixed for them.

Does anyone think this an appropriate description of such mild-mannered men as Mitt Romney, Tim Pawlenty and Jon Huntsman?

<span style='font-size: 11pt'>"The GOP's Hezbollah Wing Is Now Fully in Control," screams The New Republic</span> over a recent lead editorial.

Other columnists <span style='font-size: 11pt'>charge the GOP with holding America "hostage" by refusing to accept tax hikes</span> to avert a default on the debt.

What to make of this hysteria?

<span style='font-size: 14pt'>The Establishment is in a panic. It has been jolted awake to the realization that the GOP House, if it can summon the courage to use it, is holding a weapon that could enable it to bridle forever the federal monster that consumes 25 percent of gross domestic product.</span>

<span style='font-size: 11pt'>To bully and blackmail the GOP into surrendering the weapon and betraying its principles and signing on to new taxes, that establishment has unleashed rhetoric more befitting a war on terror than a political dispute.</span>

For how, exactly, are Republicans threatening the republic?

<span style='font-size: 11pt'>The House has not said it will not raise the debt ceiling. It must and will. It has not said it will not accept budget cuts. It has indicated a willingness to accept the budget cuts agreed to in the Biden negotiations.

Where the GOP has stood its ground is on tax increases.</span>

Is fanaticism behind this stance? Does this manifest insanity? How does this imperil the nation's honor and future?

Behind the GOP opposition to tax hikes is the party's word given to the country that elected it in 2010, its political principles, its traditional view of what not to do when the nation is in a slump, and party history.

<span style='font-size: 11pt'>Fully 235 Republican House members signed a 2010 pledge not to raise taxes. And by giving their word they were rewarded with victory.

Should they now dishonor that pledge, what would differentiate them from George H.W. Bush, who famously promised in 1988: "Read my lips! No new taxes!" then went back on his word and took the party down to defeat with him?</span>

Second, the GOP is the party of small government and low taxes.

Why would it agree to raise taxes on the private productive sector when federal spending, now at a peacetime record of 25 percent of GDP, is the problem?

Third, America is in a slump, with 9 percent of the workforce unemployed, another 7 percent underemployed and the economy growing at a tepid 1.8 percent.

<span style='font-size: 17pt'>What school of economic thought -- Keynesian, supply-side or monetarist -- says raising taxes in a slumping economy is the recipe for a return to prosperity? There is no such school.</span>

<span style='font-size: 11pt'>Why, when the whole country is talking about the need to create jobs, would Congress raise taxes on a private productive sector that employs six in seven Americans and is the creator of real jobs?</span>

In 1982, President Reagan agreed to the same deal being offered the party today: three dollars in spending cuts for every dollar in tax increases to which he assented. As he ruefully told this writer more than once, <span style='font-size: 11pt'>he was lied to. He got one dollar in spending cuts for every three in tax increases.</span>

What of the charge that the Republican House is holding America hostage, blackmailing the nation with a suicidal threat to throw us all into national default if it does not get its way?

<span style='font-size: 14pt'>This smear is the precise opposite of the truth.

The Republican Party has not said it will refuse to raise the debt ceiling. It has an obligation to do so, and will.

The House has simply said it will not accept new taxes on a nation whose fiscal crisis comes from overspending.</span>

If the GOP keeps its word, raises the debt ceiling and accepts budget cuts agreed to in the Biden negotiations, the only people who can prevent the debt ceiling's being raised are Senate Democrats or Obama, in which case, they, not the GOP, will have thrown the nation into default.

<span style='font-size: 11pt'>It is the establishment that is resorting to extortion, saying, in effect, to the House GOP: Give us the new taxes we demand, or Obama will veto the debt ceiling and we will all blame you for the default.</span>

<span style='font-size: 14pt'>They're bluffing.</span>

<span style='font-size: 14pt'>The GOP should stand its ground</span> <span style='font-size: 20pt'>-- and fix bayonets.</span> </div></div>

I'm hoping the republichickens have finally grown a set and follows the advice!

http://farm5.static.flickr.com/4095/4803200621_a4c328ddc1.jpg

<span style='font-family: Comic Sans MS'><span style='font-size: 26pt'>CHARGE! (http://www.realclearpolitics.com/articles/2011/07/08/an_establishment_in_panic_110501.html)</span></span>

Sev
07-09-2011, 11:17 AM
Well if they have to balls they will not allow a rise in the debt ceiling.

LWW
07-09-2011, 12:10 PM
Even I would oppose that.

But, deep spending cuts must be enacted before any new debt can be tolerated.

A complete halt to deficit spending would, at this point, be chaotic ... but I think something along the lines of spending being limited to ((100% of today's level + revenue growth) X 90%) should be a minimum first step.

Such a formula would force the congress to fixate on growth oriented policy and ferreting out waste, instead of talking about it.

If I had Boehner's job I would demand that the FAIRTAX be implemented or no deal.

Soflasnapper
07-09-2011, 01:59 PM
Here's the problem with all freeze ideas.

SS and Medicare spending is in the total of spending. These are going up annually by the CPI (for SS, although that's now two years with an alleged 0% CPI and no increase), and by new beneficiary retirees, and about 4.6% per capita for Medicare costs, with again more capitas every year.

So these increases, which are required in law so far, must take place, which by themselves probably exceed what tightening you propose. Meaning the cutting elsewhere must be greater by that amount. Or you need to somehow curb the increases in these two programs that are in the law currently.

One possible compromise is to take the rest of the budget and apply that decrease you mention, and then offset the greater increase percentage than that in these two programs by greater taxation at the top end.

This actually would reflect the will of the people, who say by 70% majorities not to cut SS/MC, and also (by comparable margins) that they favor implementing higher rates of taxation on the wealthy.

Buchanan's argument that any increased tax depresses growth is sorta true, but sorta false as well. Just as is the notion that tax CUTS are way stimulative. They ARE stimulative, just by an anemic multiplier well below 100%, and not much bang for the buck, especially compared to alternatives. On the flip side, their contractionary effects are also de minimus, and people that well understand the economic arguments do not think they will have a significant effect on economic growth or jobs.

LWW
07-09-2011, 03:57 PM
What percentage of waste and fraud do you honestly believe there is in the SS and MEDICARE/MEDICAID programs?

My guess would be an easy 20%.

From my experience, an easy 50% of adult SS recipients under 62 are getting the benefit illegitimately.

Many over 62 are continuing to work in the underground economy and exceeding the legal income limits.

The Fair Tax fixes all of that ... the problem is that this aforementioned group votes democrook by a wide margin.

LWW
07-09-2011, 04:11 PM
<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: Soflasnapper</div><div class="ubbcode-body">Buchanan's argument that any increased tax depresses growth is sorta true, but sorta false as well. Just as is the notion that tax CUTS are way stimulative. They ARE stimulative, just by an anemic multiplier well below 100%, and not much bang for the buck, especially compared to alternatives.</div></div>

That is both doublethink and wrong headed.

The democrook party practices and teaches stupidonomics, and the main flaw in stupidonomics is that the economy is static.

Let me give you an example.

Let's say 1,000 people are taxed an additional $10K each. The money goes to the state and is flushed down the money money hole in the majority.

Now, let's say the same 1,000 folks are taxed $10H less. Here's one thing for sure, they aren't going to bury it in the back yard ... hence it isn't simply 1,000 people getting $10K extra.

Let's say they all buy a new car with a third down. At $30K per unit and 1,000 cars ... $30M in sales took place. That's a years sales for a well above average sized new car dealership that will employ about 100 people at an average earnings of about $45K each. That's also a weeks production for a large assembly plant. That plant will employ about a thousand people that week at about $1,500 each. That's $1.0M in payroll ... call it $1M to allow for about 30% imports. That's also $4.5M in income for the dealer. So that's $5.5M at 20% ... or $1.1M.

We haven't yet taken into account the trickle down to the bank employees, delivery drivers, parts suppliers, advertising folks, and the many many more who are employed.

We also have yet taken into account the trickle down as these people spend their earnings ... and if you give blue collar folks earnings they do tend to spend it,

It also doesn't yet account for the 100+ good paying jobs created which took 100+ families off of UE, foodstamps, and welfare.

It also hasn't taken into account, yet, the $2M in sales tax revenues this would generate.

Soflasnapper
07-10-2011, 08:21 PM
I agree, putting money into the pocket of ANYONE but the rich will be stimulative, in a fairly big way.

However, putting money into the pocket of the rich will not be very stimulative, because they have a lesser marginal propensity to spend, and a far larger propensity to save, extra money.

It's a proven fact, and obvious, when you consider that one of the definitions of the term 'rich' is that they can afford to buy anything they want, because they are already flush with cash.

Now, if someone can already buy everything he desires, guess what? He probably has already bought everything he desires, having that cash availability.

Will giving him a little more cash, relative to his already large cash holdings, make him want to buy something MORE? What COULD he buy, if he's already bought everything he wanted ahead of that time? Will he buy another car, assuming that if he'd wanted more than one car (or x cars), he'd already have bought them?

Lookit, people already do economics considering the 'dynamic approach,' meaning considering the changes in motivations and opportunities relative to the 'static approach' analysis. They do not find substantial reflows from these admittedly existing, but weak, extra incentives.

Back when Dole rolled the dice by picking his former political theorist foe Jack Kemp as his VP candidate, and abandoned all his previous career's emphasis on fiscal conservatism in favor of the go-go supply sider base represented by Kemp, he proposed a tax cut, and scored it on dynamic terms, as repaying 15% of the static analysis loss of revenues, from the stimulative effect. Back in the day, Dole would never have done that-- he knew better. And analysis showed that these dynamic effects of reflow from stimulus overstated any historical example by 100%-- that the only evidence out there showed about a **7%** reflow.

LWW
07-11-2011, 03:57 AM
<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: Soflasnapper</div><div class="ubbcode-body">However, putting money into the pocket of the rich will not be very stimulative, because they have a lesser marginal propensity to spend, and a far larger propensity to save, extra money.</div></div>

Thank you. The economy is not static. They will not stuff the money into the mattress.

They will invest where returns can be found. This is how capitalism works ... it takes "CAPITAL" from those seeking to invest and then creates all manner of for profit enterprise which creates jobs which creates tax revenues.