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Forums - General - The big problem with Obama's economic plan.

whatever on 11 September 2008

Economics is a vast and complex subject that can't be summed up by simple statements like "lower taxes means more revenue". That is always a republican talking point, but there is no proof one way or the other that it is true.

Just because revenue went up 20% over the last 8 years (I'm too lazy to check if it is true) doesn't mean this is due to the tax cuts. Revenue may have grown more if we didn't have the tax cuts.

The facts we do have are that the presidents that espoused this theory (Reagan & Bush II) are by far the worst when it comes to putting our country into a debt that we'll likely never get out of.

http://zfacts.com/p/318.html

"Some say Reagan had nothing to do with the debt's U turn
They say it was Congressional Democrats. Not true. Had things worked out just as Reagan proposed and predicted, the debt still would have gone up 85% as much. But even this is deceptive. The reason his predicted savings did not materialize was not Congress. The reason was that he predicted much more economic growth from supply-side magic than actually happened. So he counted on taxes that were never collected to help his budgets. In fact a study by the House found that Reagan asked for $29.4 billion more in spending than Congress passed."



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The_vagabond7 on 11 September 2008

an independant study (sorry, drunking) showed both there econmic plans ended in trillions in debt by 2012. They are just talking shit, because it's wat people want to hear.



You can find me on facebook as Markus Van Rijn, if you friend me just mention you're from VGchartz and who you are here.

steven787 on 11 September 2008
TheRealMafoo said:
steven787 said:

In Nominal/Real(2008) Trillions of US$

Projected fiscal 2009
Revenue: 2.77/NA
Spending: 3.10

2008:
R: $2.66/2.66
S: $2.9


2007:
R: $2.4/2.51
S: $2.8

2006
R: $2.2/2.32
S:$2.7

Notice that those numbers do outpace inflation but not real GDP growth (~2.2% for the past few years averaged) or deficit spending.

Thanks Steven. Where did you get these numbers? How far back can you get them for?

 

 

 

It wasn't posted to prove you right.  While fundamentally the statement that "tax revenue went up" is true, it doesn't compare well when you include GDP growth.

Despite taxes being low, growth has been slow and tax revenues still do not keep up with them.

The defecit is sickening.  I have never seen such a bad annual defecit at the same time as real income going down.

I got the Nominal numbers from the federal budget published every year all over the web.  The real dollars I figured out with a calculator and a very generous CPI measure.



I would cite regulation, but I know you will simply ignore it.

TheRealMafoo on 11 September 2008
steven787 said:
TheRealMafoo said:
steven787 said:

In Nominal/Real(2008) Trillions of US$

Projected fiscal 2009
Revenue: 2.77/NA
Spending: 3.10

2008:
R: $2.66/2.66
S: $2.9


2007:
R: $2.4/2.51
S: $2.8

2006
R: $2.2/2.32
S:$2.7

Notice that those numbers do outpace inflation but not real GDP growth (~2.2% for the past few years averaged) or deficit spending.

Thanks Steven. Where did you get these numbers? How far back can you get them for?

 

 

 

It wasn't posted to prove you right. 

I know, but at least it's numbers, and not just a "your wrong" argument. I would like to see these numbers over the last 20 years.

 



akuma587 on 11 September 2008
TheRealMafoo said:

 

Again, this is all great, but where does it discredit what I have said? All you have said is I did not show due diligence in my assertions, thus they are wrong.

prove to me they are wrong.

Have we not collected more taxes in the years we lower taxes then in the years we have raised them? If you think not, show me.

What's in red, is what I said at the start of this thread. Our issue is spending. Can you show me where Obama plans to spend less?

So you can make a ridiculous claim, I can show you why your claim is ridiculous, and you claim that until I enact a complete analysis on your lack of any logic whatsoever that I have yet to prove you wrong?  I hope you never go to law school, because you will fail, miserably.

Obama is going to raise taxes on the rich, thus allowing him to spend more.  His tax cuts for the middle class are also lower than McCain's.  And yes, raising taxes on the rich (top 1%) will raise revenue.  Their Laffer Curve midpoint is much higher than lower economic brackets because they have more overall income. 

And if you think the rich will stop trying to make money just because their taxes are slightly higher you are sadly mistaken.  Many of those taxes are computed after their personal income taxes as well, so it wouldn't even be a tax they could immediately foresee, which would make it even less likely that they would modify their behavior to account for that tax.

You have yet to explain why higher taxes discourage someone from working more?  Obviously excessively high taxes (such as 70%) may do so, but why would someone in being taxed 35% have less incentive to make money than someone being taxed 40%.  The Laffer Curve itself is hopelessly flawed because it assumes that people actually stop wanting money more if they are taxed higher.  People always want money, no matter how high they are being taxed, its human nature.  The Laffer Curve has some rationale behind it, but it oversimplifies the situation way too much.

You are making the claim, so the burden of proof is on you to show why the Laffer Curve is even accurate (and oddly enough, I was the one who had to fill in your sloppy analysis by bringing up the idea of the Laffer Curve in the first place...)

 



We had two bags of grass, seventy-five pellets of mescaline, five sheets of high-powered blotter acid, a salt shaker half full of cocaine, a whole galaxy of multi-colored uppers, downers, screamers, laughers…Also a quart of tequila, a quart of rum, a case of beer, a pint of raw ether and two dozen amyls.  The only thing that really worried me was the ether.  There is nothing in the world more helpless and irresponsible and depraved than a man in the depths of an ether binge. –Raoul Duke

It is hard to shed anything but crocodile tears over White House speechwriter Patrick Buchanan's tragic analysis of the Nixon debacle. "It's like Sisyphus," he said. "We rolled the rock all the way up the mountain...and it rolled right back down on us...."  Neither Sisyphus nor the commander of the Light Brigade nor Pat Buchanan had the time or any real inclination to question what they were doing...a martyr, to the bitter end, to a "flawed" cause and a narrow, atavistic concept of conservative politics that has done more damage to itself and the country in less than six years than its liberal enemies could have done in two or three decades. -Hunter S. Thompson

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akuma587 on 11 September 2008
steven787 said:
TheRealMafoo said:
steven787 said:

In Nominal/Real(2008) Trillions of US$

Projected fiscal 2009
Revenue: 2.77/NA
Spending: 3.10

2008:
R: $2.66/2.66
S: $2.9


2007:
R: $2.4/2.51
S: $2.8

2006
R: $2.2/2.32
S:$2.7

Notice that those numbers do outpace inflation but not real GDP growth (~2.2% for the past few years averaged) or deficit spending.

Thanks Steven. Where did you get these numbers? How far back can you get them for?

 

 

 

It wasn't posted to prove you right.  While fundamentally the statement that "tax revenue went up" is true, it doesn't compare well when you include GDP growth.

Despite taxes being low, growth has been slow and tax revenues still do not keep up with them.

The defecit is sickening.  I have never seen such a bad annual defecit at the same time as real income going down.

I got the Nominal numbers from the federal budget published every year all over the web.  The real dollars I figured out with a calculator and a very generous CPI measure.

This is why we are right and you are wrong.  The numbers don't lie when accounting for the factors that you blatanly ignored in your analysis, or lack thereof.

You have yet to provide any evidence that the Laffer Curve is even accurate in the first place.  It is a highly contested and criticized model for determining economic behavior, and has little real data to support it.

 



We had two bags of grass, seventy-five pellets of mescaline, five sheets of high-powered blotter acid, a salt shaker half full of cocaine, a whole galaxy of multi-colored uppers, downers, screamers, laughers…Also a quart of tequila, a quart of rum, a case of beer, a pint of raw ether and two dozen amyls.  The only thing that really worried me was the ether.  There is nothing in the world more helpless and irresponsible and depraved than a man in the depths of an ether binge. –Raoul Duke

It is hard to shed anything but crocodile tears over White House speechwriter Patrick Buchanan's tragic analysis of the Nixon debacle. "It's like Sisyphus," he said. "We rolled the rock all the way up the mountain...and it rolled right back down on us...."  Neither Sisyphus nor the commander of the Light Brigade nor Pat Buchanan had the time or any real inclination to question what they were doing...a martyr, to the bitter end, to a "flawed" cause and a narrow, atavistic concept of conservative politics that has done more damage to itself and the country in less than six years than its liberal enemies could have done in two or three decades. -Hunter S. Thompson

TheRealMafoo on 11 September 2008
akuma587 said:

This is why we are right and you are wrong.  The numbers don't lie when accounting for the factors that you blatanly ignored in your analysis, or lack thereof.

You have yet to provide any evidence that the Laffer Curve is even accurate in the first place.  It is a highly contested and criticized model for determining economic behavior, and has little real data to support it.

 

 

wht? I have never once even referenced the Laffer Curve, and now you are arguing that I need to show proof that it's accurate? lol

I will make these statement:

  • When we have lower taxes, the government collects more money. Fact.
  • When we have raised taxes, the government has collected less money. Fact.

I don't need a Curve, or any fancy analysis to know this, I only need history. I can not explain why it works that way, I can only tell you that it does. I can tell you this... BECAUSE IT HAS.

Those are clear statements. Show me where they are wrong. Not with some babble about how they could be wrong, Show me where they ARE wrong. 



akuma587 on 11 September 2008
TheRealMafoo said:

 

 

  • When we have lower taxes, the government collects more money. Fact.
  • When we have raised taxes, the government has collected less money. Fact.

 

I don't need a Curve, or any fancy analysis to know this, I only need history. I can not explain why it works that way, I can only tell you that it does. I can tell you this... BECAUSE IT HAS.

Those are clear statements. Show me where they are wrong. Not with some babble about how they could be wrong, Show me where they ARE wrong. 

Neither of those two statements are facts, they are assertions without any evidence tied to them.  How can you say they are facts WHEN YOU HAVE NOT EVEN LOOKED AT THE GOVERNMENT'S TAX REVENUE BESIDES WHAT WE HAVE POSTED HERE.

What history have you shown?  You can tell me this because it has?  You have yet to show me that those statements are even true.  You are simply regurgitating the supply-side economics propaganda you have heard people tell you in the past which has yet to be proven true.  Ironically, I am more familiar with supply-side economics than you, yet you are claiming it to be fact even though it is a highly contested theory.

I am not going to continue arguing with you because you are apparently incapable of articulating even a basic argument.

 



We had two bags of grass, seventy-five pellets of mescaline, five sheets of high-powered blotter acid, a salt shaker half full of cocaine, a whole galaxy of multi-colored uppers, downers, screamers, laughers…Also a quart of tequila, a quart of rum, a case of beer, a pint of raw ether and two dozen amyls.  The only thing that really worried me was the ether.  There is nothing in the world more helpless and irresponsible and depraved than a man in the depths of an ether binge. –Raoul Duke

It is hard to shed anything but crocodile tears over White House speechwriter Patrick Buchanan's tragic analysis of the Nixon debacle. "It's like Sisyphus," he said. "We rolled the rock all the way up the mountain...and it rolled right back down on us...."  Neither Sisyphus nor the commander of the Light Brigade nor Pat Buchanan had the time or any real inclination to question what they were doing...a martyr, to the bitter end, to a "flawed" cause and a narrow, atavistic concept of conservative politics that has done more damage to itself and the country in less than six years than its liberal enemies could have done in two or three decades. -Hunter S. Thompson

TheRealMafoo on 11 September 2008
akuma587 said:
TheRealMafoo said:

 

 

  • When we have lower taxes, the government collects more money. Fact.
  • When we have raised taxes, the government has collected less money. Fact.

 

I don't need a Curve, or any fancy analysis to know this, I only need history. I can not explain why it works that way, I can only tell you that it does. I can tell you this... BECAUSE IT HAS.

Those are clear statements. Show me where they are wrong. Not with some babble about how they could be wrong, Show me where they ARE wrong. 

Neither of those two statements are facts, they are assertions without any evidence tied to them.  How can you say they are facts WHEN YOU HAVE NOT EVEN LOOKED AT THE GOVERNMENT'S TAX REVENUE BESIDES WHAT WE HAVE POSTED HERE.

What history have you shown?  You can tell me this because it has?  You have yet to show me that those statements are even true.  You are simply regurgitating the supply-side economics propaganda you have heard people tell you in the past which has yet to be proven true.  Ironically, I am more familiar with supply-side economics than you, yet you are claiming it to be fact even though it is a highly contested theory.

I am not going to continue arguing with you because you are apparently incapable of articulating even a basic argument.

We both have an economic model that we think in theory works. I have at least the last three years of numbers to show that lowering taxes raised revenue beyond inflation. That means we collected more money (pissed it away at an insane rate, but that's another argument).

Your model (raise taxes and we get more money) has.... umm... zero evidence shown in this thread. You just have your theory. What I would like, is a chart showing how much revenue the government collected each year, and look to see if taxes were raised or lowered that year. I can not find such a chart.

So, we have your opinion against mine, with three data points suggesting mine is right.

 

 



TheRealMafoo on 11 September 2008

"Tax rates were slashed dramatically during the 1920s, dropping from over 70 percent to less than 25 percent. What happened? Personal income tax revenues increased substantially during the 1920s, despite the reduction in rates. Revenues rose from $719 million in 1921 to $1164 million in 1928, an increase of more than 61 percent."

http://www.heritage.org/research/taxes/wm327.cfm