Congratulations to the Dems - Page 5

There's nothing misleading about it. Compare the growth for 2001-2006 to 1993-1998. Or whatever other similar comparison you want. Or look at growth under Reagan compared to other periods. There's just no evidence that growth after tax cuts is greater than otherwise. The only evidence shows that revenues are smaller and deficits are larger.
No it is not more modern than that. It may even be older than Reagan, but it first took hold of American conservatism with Reagan's economic policies. I don't know if Reagan would have had a balanced budget without his spending increases, and I doubt you do either (feel free to provide some evidence), but I know for certain that his tax cuts didn't results in surpluses as was predicted.


Speak for yourself. I pay taxes and I don't consider them good for me. I'd rather not put my taxes onto my children and grandchildren, or in the hands of the foreign countries that hold our debt.
Please provide an example then. Even Bush's own economists don't believe it.

In recent testimony before Congress’s Joint Economic Committee, Edward Lazear, current chairman of President Bush’s Council of Economic Advisors, stated, “I certainly would not claim that tax cuts pay for themselves.

N. Gregory Mankiw, former chairman of President Bush’s Council of Economic Advisors and a Harvard economics professor, wrote in his well-known 1998 textbook that there is “no credible evidence” that “tax revenues … rise in the face of lower tax rates.” He went on to compare an economist who says that tax cuts can pay for themselves to a “snake oil salesman trying to sell a miracle cure.”

Commenting on President Bush’s claim that tax cuts pay for themselves, the Economist magazine recently wrote, “Even by the standards of political boosterism, this is extraordinary. No serious economist believes Mr. Bush’s tax cuts will pay for themselves.”


Yes, but you can also look at revenues and see how much they change, and again, there's just no evidence that revenues show a net increase after tax cuts.

Please Chris, instead of throwing out one-liners on this, look at serious conservative economists (like the Bush administration economists I cited above) and discover the truth on this. If your common sense doesn't tell you it's a line of bull, that is.

Is anything objectively good for all people?

Are you using Good as in the Holy Good?

Human rights.

What about the owners of factories?

Why should their profits be reduced by giving people 60 hour work weeks; they suffer for the good of uneducated and obviously unworthy employees, psha?

Ah, yes.

Oh wait.

Perhaps you should read up on one of the main reasons for the nazis' rise to power.

Because the right of a business owner to earn profit is not absolute.

Do you think that a person should be allowed to keep the fruits of their labors?

Of course.

But that doesn't extend as an absolute right in anyone's mind.

Except in the mind of an anarchist. Are you an anarchist, Chris?

Despite this childish comment...I'll continue...


Under what conditions doesn't it extend/apply? Under what conditions should a person not be allowed to keep the fruits of their labors?

I want to know where you stand first.

Is it an absolute right? If you think it is, you're an anarchist (of the anarcho-capitalist variety-- in the shopping isle at the grocery store next to all the "nuts").

Germans voted them in?

They didn't have to.

Well duh.

And what was one of the main arguments for the party? Hm?

Improving economy.

I was playing devil's advocate, and Chris... He's just the devil.

That's one of the main arguments of every party. Is there going to be a political party that stands on the platform of ruining the economy?

That has nothing to do with taxes, if it is true. In the late 1970s and early 1980s the US economy was craptastic because of external influences and internal expenditures.

Your point being?

You said:


They didn't suffer a bit; they were in a devastating situation throughout most of the Weimar Republic.

You then said:


You're implying the post-1929 depression didn't affect Germany; it did and was one of the leading reasons to bring politicians in power that claimed to pursue a more aggressive approach to solving problems. And the nazis claimed just that.

I agree it did affect Germany, but only for two years (?) versus the nearly 14 it took the US to get out of it... Hyperinflation ended German debt, which allowed their economy to stabilize faster than otherwise. It is in every macroecon book out there.

Fair enough, I can agree with that.

Are you still in Germany, btw, Chucker? If so, go to bed...

I am off to sleep as is, but I understand your point, the Weimar Republic wasn't heaven on earth... but hyperinflation made sense to the economy of germany at least temporarily...

oopss... saw your post after i wrote this... good...

No, there just comes a point where it's no longer worth it for me to try to prove you wrong. If I'm not going to convince you, why waste my time? You think you are helping your case by acting authoritarian and patronizing me, but it really dosn't. It just makes you look like a damn fool. In another thread, I called someone else on doing this to you. And that person I agreed with.

Unfortunately.


That would require being able to sleep.


Right, but to the average German, it looked like Democracy only brings chaos and an unmanageable economy, and the nazis knew how to exploit this idea.

Nope. Revenue as a % of GDP was at 19%-20% when Reagan took office, and went to 17% when his tax cuts took effect. It didn't get back up to 19% until 1997. Look at the numbers here (pdf file). They were again up to 20% when Bush took office, and then after his tax cuts they went down to 16-17% again, where they remain today.

Of course revenues in raw numbers eventually go up with population increases, inflation, the business cycle, etc. They go up with or without tax cuts, eventually. But with tax cuts, they go up less, not more, and certainly not enough to pay for themselves.

Again, not a single serious economist would ever make such an argument. I urge you to listen to Bush's own economic advisors that I cited earlier, rather than Bush or Limbaugh or some other "shill," as you would say. Please find me a serious economist who argues that tax cuts "pay for themselves." It's not only a Big Lie, it's a damaging one in that it enables those who use tax cuts to gain votes at the expense of the country.

Don't worry, I wasn't offended. Just tired and frusterated. You can lead a horse to water but you can't make him drink.

And don't get me wrong, some of your arguments make good solid sense. A few others didn't. And I have in the past backed up many of my arguments with facts, etc. I think it was Chris Chilla that was telling me the deficit was equal under Bush than clinton when compared to GDP (blatently false). My point about inflation that I was arguing with Chris Chilla about was that the economy is as complex a system as the weather and it is not entirely cause/effect. If the economy was not a complex system, people could predict it down to the tee. Many factors which are so called "terrible" in economics actually are necessary to the process.

But the GDP doesn't go up any more than other periods, including periods in which tax increases were enacted! Look at the numbers from the CBO file I gave you. After 1981 and after 2001 there were significant real drops in revenues. Then the revenue growth goes back up to about 10% per year from that point, as it always does.

Do you and Chris really believe that you can cut taxes and you'll get more taxes than you would have otherwise? Despite the fact that economists who work for the Bush White House deride that view? Who could be more motivated to support it than economists who work for a White House that espouses that very view? This isn't an argument over values or principles or fuzzy data, Chris and SDW. This is about whether you believe in a world of fantasy or reality.

SDW

1) Sure, I do think that cutting taxes (or increasing gov't spending, for that matter) can help the economy. But I don't think the amounts we're talking about cutting or raising can make that much of a difference compared to other economic factors like the normal business cycle. It's not as if growth after Clinton's tax increases was anemic, and growth after Bush's and Reagan's tax cuts was stratospheric. The numbers just don't show that.

2) Although tax cuts can affect the economy, they can't "pay for themselves." For example, you might be able to cut taxes by 100 billion, but only lose 95 billion in revenue due to the positive effects on the economy. But you couldn't cut taxes by 100 billion and then create enough growth that you don't lose any revenue at all. It's that "paying for themselves" line that Bush's Council of Economic Advisors has rejected.

3) I also believe that in the long-run, tax cuts that increase deficits are harmful to economic growth. And let's not kid ourselves, that's exactly what happened during Reagan, and it's exactly what's happening now: We not only cut taxes, but we increased spending. Let's not talk about some hypothetical world where we cut spending along with cutting taxes.

Maybe you should write your thoughts about spending and taxes and growth in your new blog.

The best you can do is look at the growth rates when taxes were cut vs. when they weren't, and when you look at that, you don't see a discernible difference. You of course have to compare the same part of the business cycle - it would be unfair to compare a recession to a recovery.

Let me try it this way. Look at revenue growth from, say, 1994 to 2001. There were no tax hikes or cuts to speak of during that period. And yet there was tremendous growth in revenue, about 10% per year.

Here are the numbers:

YEAR.....REVENUES
1994.....1,258.7
1995.....1,351.9
1996.....1,453.2
1997.....1,579.4
1998.....1,722.0
1999.....1,827.6
2000.....2,025.5

So revenues increase absent tax increases. There's population growth, there's inflation, there's economic growth, etc., and they all lead to regular increases in revenues. Do we agree on that?

Now look at revenues from 2000-2005.

YEAR.....REVENUES
2000.....2,025.5
2001.....1,991.4
2002.....1,853.4
2003.....1,782.5
2004.....1,880.3
2005.....2,153.9

Revenues decreased for several years, but look to now be going back to the regular increases. So, tax cuts result in a loss of revenue when they're enacted, but then revenues continue to increase as they always do, but from that new baseline.

If taxes had not been cut, we would have presumably continued with regular revenue growth of about 5-10% per year which would put us at close to 3 trillion if my rough math is correct. Instead it's barely above where we were 5 years ago. Or you can just look at it in terms of revenues as a % of GDP to see the drop in revenues. It was 20% in 2000, it's 17% now.

Now here's Reagan:

YEAR.....REVENUES
1980.....517.1
1981.....599.3
1982.....617.8
1983.....600.6
1984.....666.5
1985.....734.1
1986.....769.2
1987.....854.4
1988.....909.3

Note the slow growth from 1981-1982 and the real drop in 1983. Then it goes back to regular increases of 5-10%. Without the tax cuts, we would have seen those regular 5-10% increases as usual, which would have put us at much higher revenue levels than we actually had.



Saying that spending increases and not tax cuts cause deficits is like saying the 2 but not the 1 causes the 3 in 2 + 1 = 3. Deficits are the result of tax cuts and spending increases not being in line. Yes, spending increased faster than taxes during the 1980s and the 2000s. But if we hadn't cut taxes, we wouldn't have had deficits. Or if we had cut spending rather than raised it, we wouldn't have had deficits.