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Reviewing Obama’s sparsely-attended class warfare speech… oh, SUGAR.

By: Moe Lane (Diary)  |  December 6th, 2011 at 08:00 PM  | 

RESIZE: AAA

Said speech was in Osawatomie Texas no, wait, he meant Kansas, where President Barack Obama hopes to recreate a little electoral magic represented by Teddy Roosevelt’s speech in 1910… to wit, splitting the Republican vote and thus getting a Democrat elected. The speech itself is pretty mediocre, even by this President’s standards: but then, if you’re looking for deathless prose then you’re following the wrong Presidential administration. As Ace of Spades notes, President Obama seems to have a definite problem with this entire capitalism thing; to which I would add that this is really a perfectly normal position to take… if you are a person who has spent his entire adult life being paid from an account funded by other people’s tax money.

Also, it is probably mean-spirited of me to note that the three most obvious major differences between Obama’s speech and Teddy Roosevelt’s are these:

  1. Teddy Roosevelt knew who John Brown was (I understand that Osawatomie Brown is a sore topic for Democrats, of course).
  2. Teddy Roosevelt started his speech by endorsing the notion that throwing out politicians who broke campaign promises was a darn good idea (I understand that Obama’s habits of routinely breaking his word is a sore topic for Democrats, of course).
  3. Teddy Roosevelt could draw a crowd (30,000 vs. Obama’s 1,200). Smart of the White House to pick a high school gym, though: that way they don’t have to worry about too much in the way of open space.

But the real news? It’s this passage:

I think about a company based in Warroad, Minnesota called Marvin Windows and Doors. During the recession, Marvin’s competitors closed dozens of plants and let go hundreds of workers. But Marvin didn’t lay off a single one of their four thousand or so employees. In fact, they’ve only laid off workers once in over a hundred years. Mr. Marvin’s grandfather even kept his eight employees during the Depression.

Based on the Obama administration’s past track record with companies that they mention by name in their speeches – Solyndra, Cardinal Fastener & Specialty Co., New Chet’s Restaurant – this pretty much means that Marvin Windows and Doors is just counting the days until it needs to file for bankruptcy under Chapter 11. Seriously, this President can kill jobs just by looking at them wrong…

Moe Lane (crosspost)

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COMMENTS

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  • michaelbowler

    Obama gave another meaningless speech…so what?

    Has he really ever swayed anyone not already predisposed to swallow his lies?
    Does anyone think that there will be as many so predisposed in 2012? Really?

  • ashland_avenue

    1. I had some time today and was able to hear the first parts of speech as broadcast on Fox News.

    2. While agreeing with very little of the President’s points of view, I did admire the way in which he set about putting present economics problems in context.

    Very early in the speech he said this:

    “Today, we?re still home to the world?s most productive workers. We?re still home to the world?s most innovative companies. But for most Americans, the basic bargain that made this country great has eroded. Long before the recession hit, hard work stopped paying off for too many people.

    “Fewer and fewer of the folks who contributed to the success of our economy actually benefited from that success. Those at the very top grew wealthier from their incomes and their investments — wealthier than ever before.

    “But everybody else struggled with costs that were growing and paychecks that weren?t — and too many families found themselves racking up more and more debt just to keep up.”

    3. Completely lacking from the talk was what I would consider an accurate historical perspective on why the post-war US economy grew.

    4. Also lacking from his talk was discussion of the true causes of the great Real Estate Bubble. Acknowledgement of the role the Government Sponsored Enterprises of Fannie Mae and Freddie Mac had played in the boom and bust.

    5. Obama joked that like TR, he had been called a socialist and communist. Immediately, however, the President launched into a diatribe against a free economy: “Roosevelt also knew that the free market has never been a free license to take whatever you can from whomever you can.”

    If the President’s point is that economic gains should go to each according to his needs, taking from each according to his abilities, then maybe the critics have a point.

    6. From there, the President sought to pin all current ills on Red State politicians:
    “Remember in those years, in 2001 and 2003, Congress passed two of the most expensive tax cuts for the wealthy in history. And what did it get us?

    “The slowest job growth in half a century. Massive deficits that have made it much harder to pay for the investments that built this country and provided the basic security that helped millions of Americans reach and stay in the middle class — things like education and infrastructure, science and technology, Medicare and Social Security.”

    Utterly missing from his talk was acknowledgment that with the Bush tax cuts had come revenue increases. Sharp revenue increases.

    6. President Obama’s statistics seem to be at odds with those cited by the Wall Street Journal. The President said, “Look at the statistics. In the last few decades, the average income of the top 1 percent has gone up by more than 250 percent to $1.2 million per year.”

    In a recent editorial, the WSJ identified 399,000 taxpayers with incomes of over $1 million, suggesting that 75% of the are self-described business owners. How can 1% of the company be equivalent to under 400,000?

    7. One of the two major candidates needs to set out the bullish case for America, and the historic case for free markets.

    8. Recently, an NPR forum looked at factors which could be instrumental in growing the number of industrial jobs in America’s heartland. Of course the country is falling behind some other nations, one of the panelists said. This can be attributed to miserable mathematics performance amongst too many American middle school students.

    An Apple I-Phone, the speaker said, sells for about $300. Only about $8 of that is value added in China, the speaker said; most of the design and engineering functions remain in America. If American students don’t keep up math skills, however, those higher value added positions will gravitate overseas as well.

    9. In sum, the answer to a strong and growing economy is not to be found in the class warfare program The President set out today in Kansas. A simply stated summary of why there are problems and what is to be done in addressing them will go a long way in convincing the American people of Obama’s failings.

    “Look at the statistics. In the last few decades, the average income of the top 1 percent has gone up by more than 250 percent to $1.2 million per year.”

    Yet, a recent editorial in the WSJ

  • donald_24

    “Utterly missing from his talk was acknowledgment that with the Bush tax cuts had come revenue increases. Sharp revenue increases.”

    But isn’t that revenue increase mainly due to the housing and credit bubble?

  • donald_24

    Also, since you cited the WSJ, I immediately thought of this article they had a few years ago analyzing the job growth records of all recent presidents. Bush, along with Bush Sr. and Ford are tied for the worst:

    http://blogs.wsj.com/economics/2009/01/09/bush-on-jobs-the-worst-track-record-on-record/

  • Return to Revolution

    to continue channeling Teddy, right down to his 88 electoral votes and 6 states.

  • Tbone

    The only good thing about you Donald is you make rocks look smart.

  • ChicaGOP

    How much of your property taxes (housing) and sales taxes (credit) go to the federal government? I’ll give you a hint – the answer rhymes with “zero.”

  • statenislandcon

    6. President Obama?s statistics seem to be at odds with those cited by the Wall Street Journal. The President said, ?Look at the statistics. In the last few decades, the average income of the top 1 percent has gone up by more than 250 percent to $1.2 million per year.?

    In a recent editorial, the WSJ identified 399,000 taxpayers with incomes of over $1 million, suggesting that 75% of the are self-described business owners. How can 1% of the company be equivalent to under 400,000?

    The top 1% starts around $500k per year. There’s more than 400k in the top 1% because you have to count all those people between $500k and $1M, probably around 1-1.5M in total depending on how many people are classified as taxpayers.

    The average salary of that top 1% is about $1.2M a year, which makes sense because the average clearly has to be higher than the lower cutoff of $500k.

    No contradiction, just math.

  • nathanalbright

    Is Obama trying to encourage a third party among his own midst?

  • donald_24

    I’m just posting the facts. You want more facts? Here are some direct fromt eh Federal Reserve:

    In January 2001, there were 111 million people employed in the private sector.

    In January 2009, there were 110 million people employed in the private sector.

    That is a LOSS of private sector jobs

    http://research.stlouisfed.org/fred2/data/USPRIV.txt

    So how can the WSJ article show an increase in employment when we lsot 1 million private sector jobs? Simple: All of the job growth was in government. In January 2001, there were 20 million people employed in government. In January 2009, that number was 22 million:

    http://research.stlouisfed.org/fred2/data/USGOVT.txt

  • donald_24

    The jobs created by the housing bubble (ie: construction, realtors, mortage brokers, etc.) increased federal income tax revenue. It also increased capital gains tax revenue as people flipped houses for large profits.

  • statenislandcon

    That is… I don’t know. Scratching my head. That is… stunning?

    Are those numbers believable? They do seem to be from the fed, but do you have a link to their methodology? I suspect there is something strange going on because that is hard to square with all the investment that should have been happening after the large tax cuts in 2001/2003.

  • donald_24

    There was substantial investment after the tax cuts. The problem was that it was a bubble. People were investing in real estate with toxic mortgages. That is not the type of investment we should be encouraging. It’s better to have no investment than investment fueled by a housing/ credit bubble.

    There is some more detailed research from the Fed here:

    http://www.federalreserve.gov/pubs/feds/2005/200557/200557abs.html

    “We find that U.S. large-cap and small-cap indexes do not outperform their European counterparts, nor REIT stocks, over the event windows, suggesting little if any aggregate stock market effect from the tax change.”

    Here:

    http://www.federalreserve.gov/pubs/feds/2006/200614/200614abs.html

    And Here:

    http://www.federalreserve.gov/pubs/feds/2010/201034/201034abs.html

    “Recent literature has estimated that the 2003 dividend tax cut caused a large increase in aggregate dividend payouts, which would imply that dividend taxation creates large efficiency costs relative to the amount of revenue raised. I document that dividend payouts by real estate investment trusts also rose sharply following the tax cut, even though REIT dividends did not qualify for the cut. These facts suggest that contemporaneous increases in earnings and investor demand for payouts drove the observed increases in aggregate dividend payouts, with at most a modest role for the tax cut.”

  • donald_24

    Another reason for the anemic job growth over the past 10 years is because tax cuts actually crowd out private invesment, as explained by the CBO director last year:

    “But the effects of those policy options on the economy in the longer term would be very different from their effects during the next two years. The averages of the estimates across different models and assumptions indicate that all four of the options would probably reduce income relative to what would otherwise occur in 2020 (see the figure below). Those effects are largely the net result of two competing forces: All else being equal, lower tax revenues increase budget deficits and thereby government borrowing, which reduces economic growth by crowding out investment. At the same time, lower tax rates boost growth by increasing people?s saving and work effort.”

    http://cboblog.cbo.gov/?p=1427

  • wonkish1

    At the end he points out that increased debt crowds out investment. That is correct.

    But I mean question number one to that CBO director would be, “So dip$*** what do you think saving is? Because last I checked savings is investment. If its to a bank that money gets lent back out.

    So you see tax cuts boost investment and on the other side increased government debt crowds out investment. There is mitigation there.

    Furthermore, any increased debt amount is mitigated by the fact that there is more cash in the economy. An argument that for some reason the CBO will make about spending(which lags badly) and not tax cuts. Which goes to show you how pathetic they are.

    Furthermore, there is a behavior change that usually accompanies the reductions that create more ‘taxable events’ due to the reduction which means that not only is economic activity increasing, but that the static projections will once again(like always) way overestimate the ‘cost’ of tax cuts and the effects they have on new debt.

    And in addition to that, you book the efficiency savings in the dead-weight calculation.

    Meanwhile the CBO thinks that government spending is an economic multiplier of which comes with the not stated, but quite obvious assumption that the government is as efficient if not more so than the private sector….

    All you need to know about them is that according to their models the USSR should have been a raging success and that when asked, “How much revenue would occur if you raised tax rates to 100%?” the CBO analyst on the phone was actually retarded enough to respond “You would get all of the money.” While true all in that case would be $0 because the economy would halt and plummet.

  • RonLewenberg

    “In the first place we should insist that if the immigrant who comes here in good faith becomes an American and assimilates himself to us, he shall be treated on an exact equality with everyone else, for it is an outrage to discriminate against any such man because of creed, or birthplace, or origin. But this is predicated upon the man’s becoming in very fact an American, and nothing but an American…There can be no divided allegiance here. Any man
    who says he is an American, but something else also, isn’t an American at all.

    We have room for but one flag, the American flag, and this excludes the red flag, which symbolizes all wars against liberty and civilization, just as much as it excludes any foreign flag of a nation to which we are hostile…We have room for but one language here, and that is the English language…and we
    have room for but one sole loyalty and that is a loyalty to the American people.”

  • statenislandcon

    I spent the last few hours looking through the jobs data for 2001-2009. And its true. This country either gained no jobs at best, or lost jobs, during that period!

    So you see tax cuts boost investment and on the other side increased government debt crowds out investment. There is mitigation there.

    Yeah, that’s a killer point that I never saw before. Sure, tax cuts put money in investors hands, but they also created an equal amount of debt that then soaked up that increase in investment money. So in the end, the govt brought in the same amount of money, but instead of taxing it and avoiding interest, we borrowed it – from the same people – but with interest tacked on!

    I always bought into this idea that tax cuts partially, if not mostly, pay for themselves with economic expansion. But debt-driven tax cuts? They suck every dollar of that tax cut back out at the “minor” cost to the rest of the taxpayers of interest in each dollar. No expansion = full cost. And unnecessary interest tacked on to boot.

    Hmmm….

  • wonkish1

    1. It really depends on the specific tax cut to determine the degree of which they pay for themselves. In the case of Bush’s lowered capital gains rates. Sure you would think that lowered rates would decrease revenues, but at the same time with a lower rate more people were willing to take the capital gains of an appreciated stock causing more taxable events. So a lot of the ‘lost revenue’ that is initially projected is largely wiped away by the more taxable events. The same is true with the lowered dividend taxes which caused more non growth companies to start issuing dividends creating more taxable events. That’s not even including the increased economic output that more capital(because of lower rates) affords you that benefits all tax revenues.

    2. Tax cuts do produce economic expansion because they increase the amount of economic activity that people wouldn’t otherwise engage in if the tax rates were higher. Different tax cuts produce better results than other ones though so its not to an equal degree across the board.

    3. It isn’t a fair comparison to say that the tax cuts didn’t produce quality economic expansion after their enactment 10 years ago because of the employment numbers today. There was real economic expansion due to those cuts, but today we are in a bad situation that caused slack into our employment markets because of a housing crash. *Essentially the US produced real economic expansion from tax cuts a decade ago, but also ‘fake’ bubble driven economic expansion because of bad Fed policy at the same time. When the latter came to a head it did more damage then the tax cuts could possibly make up for in the employment markets. Today we have a lot more GDP than in 2001 in a small part because of better tax policy, but a large asset bubble induced crash produces slack in employment and can’t be used as evidence that the tax cuts didn’t work. Does that make sense?

    But ultimately Milton Friedman was right that while more efficient and lower tax policy is great, less government spending as a percentage of the economy is the real issue(because the negative effects of debt tend to mitigate away a lot of the benefits between having lower tax rates and higher spending).

  • statenislandcon

    It isn?t a fair comparison to say that the tax cuts didn?t produce quality economic expansion after their enactment 10 years ago because of the employment numbers today.

    I’ve been saying the same thing for some time. But if those tax cuts had any positive impact on economic growth, there wouldn’t be less jobs almost 10 years after they were enacted than there were beforehand! 10 years later, 10 years of tax cuts, and less jobs!?!?

    Year-to-year stuff is for suckers, I’ve always thought that. Bubbles happen, bubbles come, and bubbles go. But 10 years? No job growth? At some point it isn’t noise, and that point is before 10 years have passed.

  • wonkish1

    They were a positive on economic growth and employment at the time.

    Something big happened and caused a crash. Employment numbers always fall farther than GDP does.

    We’re talking about 2 things here. GDP is a much more smooth line. If it drops it doesn’t drop much or requires a seismic crash to drop a decent chunk. Employment numbers in comparison to GDP is much more volatile line. It has much higher peaks and much lower troughs. Over the long term lower tax rates is better for *long term* employment. Picking a date in time and saying something didn’t work is like pointing at the stock market at a particular date and time and trying to glean conclusions about the past and future from that.

    Lower taxes lowers the cost of doing business or the disposable cash of people so that they engage in more economic activity. Its a fact. It most definitely doesn’t mean that other factors can’t come in and be a larger force the other direction regardless if that is an asset crash or increased globalization. But then we’re just talking about the situation being if the lower tax rates weren’t in place.

  • sbm1

    the government has no business encouraging or discouraging any type of investment in legal activities.

    People invested in houses. Historically a sound investment, and one that happens to have the built in advantage of providing shelter. At some point this inclination lead to a bubble, so people who bought in the bubbling phase, did not use normal financial acumen, and failed to unload their investment before the bubble burst have been hurt financially.

    That is textbook how economics works. Faulty investments tend to lead to you losing money. sound investments tend to lead to you making money, and present value prices tend to show the percieved value of an item.

    Housing as an industry is not a bad industry. It provides a number of manufacturing jobs, and as opposed to zynga games, actually has a lasting useful output. Since America has a growing population it would seem long term that the demand for shelter will tend to grow.

    There were also idiots out there who thought investing in american solar production would be a good idea. They also rightfully have lost all their money. Sadly the government put our money behind that malinvestment as well, and didn’t even bother to seek preferential guarantees in case of bankruptcy.

    So the concept of encouraging or discouraging is stupid…the marketplace has proven extremely efficient in allocation of capital, and investing in the wrong things is somehting that tends to take care of itself!

    and to the other number…..picking january 2001 and january 2009 as dates to measure skews the results. I knwo it is first day of presidency, an last….but there was 9/11 in there, and then at the end a lot of jobs were shed. I would say take November 2001 and June 2009 and those numbers look a lot different.

    and

    Europeans, specifically Germany, had massive tax cuts in the time from 2001 until 2009, so that could easily contribute to the performance of European stocks.

  • statenislandcon

    Honestly. I can’t run that line by anyone I respect and expect them to take it seriously. GDP went up? What is the GDP? Who cares? The GDP went up, and yet the total number of jobs went down, all while the working age population probably grew 5%!?? I can’t even sell that to myself let alone everyone else.

    Lower taxes lowers the cost of doing business or the disposable cash of people so that they engage in more economic activity. Its a fact. It most definitely doesn?t mean that other factors can?t come in and be a larger force

    I guess what I’m worried about is that the increased debt those tax cuts caused was precisely that “other factor”, and, as you said, that it was a larger force.

    Look, I’m being aspy about it, but I get stuck on real numbers. And there is absolutely no evidence in any of the real numbers of there being a positive impact from 2001/2003 tax cuts.

    I can’t believe I’m writing that, and its making me mad I never looked so close before, but man you opened my eyes pointing out how the tax-cut fueled debt sucks up that investment money 1-1!

  • wonkish1

    But its important to point out that when the government encourages malinvestment through something like for example artificially low interest rates, yes the market will eventually correct that, but at the cause of pain for the general population.

    The correction is right and the cure, but the government encouragement of the malinvestment is a big problem.

    So its important not to give the impression(and I’m not saying you are actually quite the contrary) that government encouragement of malinvesment in the name of boosting the economy is a tolerable because the market will eventually correct it. Instead it should have never occurred in the first place.

  • wonkish1

    Its the amount or supply of goods and services around us.

    Economic recessions disproportionately hurt low to middle income workers and the employment numbers. So the best solution to that is to grow your way out of that.

    The increased debt is a definitely a mitigating factor. But its not 1 to 1. There are clear additional economic output advantages to lower tax rates that don’t show up as decreased revenue. Only some of that shows up as decreased revenue(resulting in higher sovereign debt), not all of it. If that were to be true the CBO’s static predictions of revenue decreases due to tax cuts would be accurate. They aren’t and they aren’t even close.

    And its the large differences between the CBO’s static predictions and the actual (much less) reduction in revenues that is the proof that they create additional economic activity. Because there is no way to explain those differences other than increased economic activity. You couldn’t explain it otherwise.

  • wonkish1

    nttt

  • statenislandcon

    The increased debt is a definitely a mitigating factor. But its not 1 to 1….And its the large differences between the CBO?s static predictions and the actual (much less) reduction in revenues that is the proof that they create additional economic activity.

    And the differences between the predictions that debt-driven tax cuts create jobs, and the simple fact that we have less jobs in the private sector now than we did in 2001? That’s a static prediction! There are less jobs now as compared to a static baseline! That isn’t just bad, that is unbelievably bad!!

    If I were feeling peverse I might think that “proved” something?

    Look, its obvious to me that tax cuts will at least partially pay for themselves. But they aren’t totally paying fo themselves, and if the debt from them is sucking up all the real economic gain…

  • sbm1

    That is why I mentioned solyndra….the government should not be encouraging or discouraging any type of investment.

  • statenislandcon

    I just realized something, I don’t know what point you are driving at.

    There were very large tax cuts in 2001/2003. Since then the raw total number of jobs in the private sector has not only failed to keep pace with population, it has actually dropped in absolute number! That made me think twice about the argument that those debt-fueled tax cuts were beneficial for the country.

    That’s where this subthread got started I think.

    What’s your point exactly? Those tax cuts actually helped create jobs or something? Or it just isn’t quite as bad as it looks, even if it is bad?

  • wonkish1

    That you will always get perpetually lower employment percentages until it hits zero and stays there?

    Lower tax rates makes you more competitive and boost economic activity. That helps **long term employment* that doesn’t necessarily mean that you wont experience periods of higher unemployment.

    Again the Fed decisions to encourage a housing bubble that eventually crashed was a much larger mitigating factor than the additional debt load could possibly be.

    THIS “Look, its obvious to me that tax cuts will at least partially pay for themselves. But they aren?t totally paying fo themselves,” AND THIS “if the debt from them is sucking up all the real economic gain?”

    ^Are a complete contradiction of each other. If you believe the former we are in agreement and if you believe in the latter we are in disagreement.

  • nathanalbright

    …and by and large I’m in favor of making legal immigration fair and easy–but with a clear end in mind of assimilation. I’m not interested at all in programs that seek to ensure generations of a permanent underclass that become indigents in need of constant government handouts and engage in corrupt and black market economics. That’s what we’ve got–and that’s exactly what I don’t want.

  • statenislandcon

    THIS ?Look, its obvious to me that tax cuts will at least partially pay for themselves. But they aren?t totally paying fo themselves,? AND THIS ?if the debt from them is sucking up all the real economic gain??

    ^Are a complete contradiction of each other. If you believe the former we are in agreement and if you believe in the latter we are in disagreement.

    Those are a “contradiction” if and only if you can imagine tax cuts solely that are funded by debt… Maybe that’s why we aren’t seeing eye to eye.

    Lower tax rates makes you more competitive and boost economic activity. That helps **long term employment* that doesn?t necessarily mean that you wont experience periods of higher unemployment.

    Again the Fed decisions to encourage a housing bubble that eventually crashed was a much larger mitigating factor than the additional debt load could possibly be.

    OK, I get it. The benefits of 10 years of tax cuts were wiped out by one housing crash. We part ways here. I look at historical trends, I see the kind jobs that can be created by 10 years of tax cuts, and the kind of jobs that can be wiped out by a housing crash, and there is no way, if there are real jobs being created, that they would be completely negated by a housing crash…

    I’m having a hard time getting past it – 10 years later, no jobs. Its hard not see the dismissal of that fact as excusing the obvious.

  • wonkish1

    1. Tax cuts did benefit the economy and employment. Employment went up for 6 and 4 years respectively. There are other factors in an economy than just tax policy. Some of which caused a huge crash and a recession. To expect that unemployment could go beyond the initial unemployment ever again is irrational.

    2. Tax cuts always at least partially pay for themselves, but rarely fully pay for themselves. To the degree that that occurs depends on the tax cut in question.

    3. Government spending as a percentage of the GDP is the biggest issue when it comes to the economy.

  • statenislandcon

    Tax cuts did benefit the economy and employment. Employment went up for 6 and 4 years respectively.

    But it’s the other way. Here’s what I know. We’ve had the tax cuts continuously for 10 years though, and at this point, jobs are less than when we started.

    If we did absolutely nothing, we would expect the raw # of jobs to increase along with the population. The reality is not only have jobs failed to increase with the population, they have decreased in raw # since this policy was enacted.

    There is a strong reason for this – the debt from the tax cuts, because they were debt-driven, sucked up the increased investment money.

    As a poor ignorant, its hard not to think that the explanation that makes sense given reality (less jobs) is far more likely to be true than the explanation that requires one to ignore reality and invoke a massive extenuating cirumstances (tax cuts increased employment, but this that and the other thing all countered it over 10 years and so we are worse off today than before).

  • wonkish1

    My point over and over again is that some(whether a lot or a little depends on the cut) of a tax cut is mitigated away by debt. Not all of it. That is the only point I’m making. Do you see a problem with that distinction?

    Of course they could. If the size of a Fed driven boom bust is larger than the affect of a tax cut then of course you can see a period of which employment has dropped. I mean you don’t believe that employment slack in an economy is impossible do you?

    By the way, I know this is off topic, but looking back at your posting history I don’t see a single conservative position you’ve ever taken. I’m not going to jump to conclusions here, but I was just curious here. Although if you really are a Democrat I don’t mind going back and forth, but that could explain why you seem intent on doing everything you can to jump to whatever excuse you can as to why you don’t want to believe that tax cuts create wealth and jobs and why you would make a comment like “GDP, who cares?” Care to comment?

  • statenislandcon

    Of course they could. If the size of a Fed driven boom bust is larger than the affect of a tax cut then of course you can see a period of which employment has dropped. I mean you don?t believe that employment slack in an economy is impossible do you?

    I hear you, I guess what I’ve been saying is that I’m staring to think that is pretty unlikely that a tax cut, the effect of which has been integrated over 10 years, wouldn’t be showing up in the black if it wasn’t getting mostly (or entirely) cancelled out by the increased debt it caused.

    Although if you really are a Democrat

    Yes, that’s why I’m advocating for non-debt-causing tax cuts… And why I think that tax cuts usually pay for themselves wrt the govt… Taking a look at your posting history I think you might be getting paranoid – I can promise you, I am not “Bob”.

  • wonkish1

    If you think that the absence of tax cuts would have led to a different outcome in regards to housing you are absolutely delusional.

    The two have practically nothing to do with each other. Actually it would have been likely worse because the tax cuts made common equity more attractive and the bubble was in fixed income. If there was a smaller spread between those tax rates the amount of capital going into fixed income would have been higher.

    I mean not only are you clearly liberal, but your delusional. You think that employment growth would have maintained itself without the tax cuts as if this housing boom and bust never happened.

    I mean you’ve got to be kidding me.

  • statenislandcon

    you don?t believe that employment slack in an economy is impossible do you?

    Actually, this narrows it down.

    Employment slack will always be there. Its the fact that the absolute number of employed people has decreased – less absolute jobs – after 10 years that is the shocking thing.

    You get that right? You understand the qualitative difference between “employment slack” – by which you seem to be implying and poopooing a fictional change of 4% unemployment to say 5% unemployment- and the reality that there are less jobs today than there were 10 years ago, yes? If you can’t meet me there, if we can’t get to the point where we both acknowledge the – to me shocking – total job #s, then what’s the point?

    “employment slack”… oh boy. You sure you didn’t have a hand in “recovery summer” or “jobs created and saved”?

  • statenislandcon

    You think that employment growth would have maintained itself without the tax cuts

    What employment growth do you speak of? Do you mean the increas in govt employees since 2001? Because I’m sure you aren’t talking about the factual decrease in the number of people employed in private industry since then, right? Because that wouldn’t make any sense at all!

    If you think that the absence of tax cuts would have led to a different outcome in regards to housing you are absolutely delusional.

    Wot? Let me repeat: Here?s what I know. We?ve had the tax cuts continuously for 10 years though, and at this point, jobs are less than when we started.

  • wonkish1

    Regardless of where you sit on the ideological spectrum your a lot more pleasant to go back and forth with than Bob. He acts like a child and stomps his feet and starts trying to annoy the other person when he doesn’t get anywhere.

    1. How so? Do you think that the housing bubble and crash wouldn’t have happened without the tax cuts?

    2. Just pointing out that you have a few weird tendencies and have made a couple weird arguments. I don’t really care that much. And am not going to leap to conclusions. Also the issue is that you seem to want to have an argument with me instead of a discussion. An argument is focused on ‘winning’ and a discussion is to try to figure out where the truth lies. The way you frame certain things signals that you would rather have the former than the latter. Someone looking for a discussion would say things like, “How would you respond to people who say…” Or “Interesting but I’m having a hard time figuring out how this would equal this this, etc.” You are taking a more firm stance against me which is okay, but atypical of a conservative that usually doesn’t take a liberal position by default when they are trying to figure something out.

    Don’t worry I’m not paranoid. I’m quite even headed and I don’t jump to conclusions(even though I may ask a couple questions from time to time).

  • wonkish1

    Your now trying to get testy in an argument where your taking the liberal position. Again this is odd behavior just pointing that out.

    Again the issue comes down to. Do you think that the housing crash wouldn’t have happened if tax cuts didn’t occur? Answer the question.

  • wonkish1

    Your dodging now.

    Do you think we would have had the same employment growth from 2001 to 2007 without the tax cuts? And do you think that the housing boom and bust wouldn’t have happened without those tax cuts?

    Its an important distinction because you seem intent on blaming current employment numbers on tax cuts(or the debt caused by the revenues not fully paid for).

    Please answer these questions.

  • Spartan4Life

    Let’s look at what happened before you go off half cocked that tax cuts don’t benefit the economy. From the Bureau of Labor Statistics:

    Year Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Annual
    2001 -16 61 -30 -281 -44 -128 -125 -160 -244 -325 -292 -178
    2002 -132 -147 -24 -85 -7 45 -97 -16 -55 126 8 -156
    2003 83 -158 -212 -49 -6 -2 25 -42 103 203 18 124
    2004 150 43 338 250 310 81 47 121 160 351 64 132
    2005 136 240 142 360 169 246 369 195 63 84 334 158
    2006 281 317 287 182 11 80 202 185 156 -8 205 180
    2007 203 88 218 79 141 67 -49 -26 69 91 127 84
    2008 13 -83 -72 -185 -233 -178 -231 -267 -434 -509 -802 -619
    2009 -820 -726 -796 -660 -386 -502 -300 -231 -236 -221 -55 -130
    2010 -39 -35 192 277 458 -192 -49 -59 -29 171 93 152
    2011 68 235 194 217 53 20 127 104 210 100(P) 120(P)

    First, you had a little thing called 9/11. We were already in a recession and bleeding jobs when Bush came into office. There were massive job losses after 9/11. Have you forgotten how bad things were already?

    In 2001, Bush tried a tax rebate program. It was a failure, just like Obama’s temporary payroll tax holiday has been and will be again. By Q1 2003 it was clear that something more had to be done. What we now call the Bush Tax Cuts were passed in May 2003. From May 2003 to November 2006 when the Democrats took over Congress 7 Million jobs were created. You want to suggest the tax cuts had nothing to do with that?

    Also, and I hate for the facts to get in the way of your narrative, But, by FY 2007 revenue to the government was at an all time high and the budget deficit was a paltry $161B. Also, why should Bush be saddled with the 6-7 million jobs lost from November 2008- December 2009? He wasn’t a Socialist president in office during that period.

  • wonkish1

    Please don’t tell me that your the type that dodges off the site when they get a tough question!

  • wonkish1

    I was engaging in a discussion with you in good faith. Am I to take your current silence that you weren’t?

  • Spartan4Life

    Just like I am many times when I hear Obama’s drivel I am asking myself today, “What is he talking about?”

    If he would ever do a press interview, here are some questions I wish someone would ask our fearless leader:

    What/who are the middle class?

    What is unfair in their life?

    What is impeding them from changing whatever it is that is unfair?

    What, exactly, would make their life fairer?

    Most middle class people I know wish they didn’t have to pay so many taxes and wish government would just leave them the you know what alone.

    Sometimes I think Obama really wants to say the poor but he knows that would be too incendiary. So, now the middle class have been thrown in with the poor for effect. I guess it makes sense as all Socialists end up doing is redistributing the misery up.

  • Spartan4Life

    Just like I am many times when I hear Obama’s drivel I am asking myself today, “What is he talking about?”

    If he would ever do a press interview, here are some questions I wish someone would ask our fearless leader:

    What/who are the middle class?

    What is unfair in their life?

    What is impeding them from changing whatever it is that is unfair?

    What, exactly, would make their life fairer?

    Most middle class people I know wish they didn’t have to pay so many taxes and wish government would just leave them the you know what alone.

    Sometimes I think Obama really wants to say the poor but he knows that would be too incendiary. So, now the middle class have been thrown in with the poor for effect. I guess it makes sense as all Socialists end up doing is redistributing the misery up.

  • dcacklam

    They both came into office during a recession that started under ‘the other party’s guy, last term’…

    Both had a huge boom under their watch – .com for BJ, housing for W – resulting in below-natural-rate unemployment and record-high stock prices.

    BOTH left office just as the boom went bust.

    Yet BJ is the ‘economic hero’ solely because of the press, and the ignorance of the public.

  • ChicaGOP

    Wanna know what investors/flippers did?
    http://www.owdlaw.com/avoiding-capital-gains-on-investment-property.html

    It’s not that hard to dodge that tax bite, especially for the professional investor.

    As to incremental income taxes, that’s pretty weak sauce. According the the National Association of Realtors site, in 2006 (the height of the bubble), there were 1.3 million licensed realtors.

    http://www.realtor.org/library/library/fg003

    That amounts to less than 1% of taxpaying Americans. I don’t think any bubble was big enough to distort revenues with 1% of tax returns. If your want to say a rising tide lifts all boats, then that’s patently obvious – but certainly not an argument against the impact of the Bush tax cuts.

    Any more questions? I’m happy to do all your Googling for you.

  • afreemaniii

    This has been great reading so far and this post is what I was looking for. The growth from 2003-2007 is the key here. That is the range that can and should be used to judge the tax cuts alone. Picking a date range from 2001-2011 brings in quite a few more variables than just tax cuts.

  • funwithknives

    mind-bending, wouldn’t it? Barry actually having to ‘Splain Himself.
    He’d have to stop doing that profile thing he does {while looking pensive and upward} ,when he wants to look involved and Oh-So- Serious, and actually have to honestly answer real questions with actual thoughts and facts.
    Are we all holding our breath for this miracle?
    Yeah-Uh-huh,You Betcha. For about 30 seconds. It would seem BHO is going to beat the collectivist drum, as a part of a plan. What is scary {a smidge, Unn-Kay?}is how many of The Anointed will eat this up and call it intellectual prose.
    {After all, he is the Smartest Guy in the room, any room. Just ask Him.}
    I’ve said it before and I’ll say it again,cubed: Progressives continually give Conservatives all the talking points we/they need. WHO in the name of all that is Holy has the BRAINS to use this as Counterfire,{a basic Military Tactic} in the Media and on Websites. It is surely NOT the Nat’l GOP,as has been proven countless times, through SO MANY incidents. { When I think of streetfighting , The GOP is way down the list of possibles} Where is the foresight here?
    We continually ask Barry: Where is the leadership?
    Well, where is it in this sphere? Is it beyond the realm of possibility that a Show of Some Spine might just equal more of what is required: Money, Volunteers, Etc.?

  • Spartan4Life

    Numbers don’t lie.

  • Spartan4Life

    Numbers don’t lie.

  • donald_24

    2005 was the peak of the housing bubble. Back then everyone thought they were going to be the next Donald Trump. Yes, 2005 was a good economic year, but it was 99% due to the bubble.

    If anything, one could argue that cutting the capital gains tax was a bad idea since it made it more profitale to flip houses, which was a major contributor to the housing bubble. Most people here will say to cut capital gains further or even cut it to ZERO, but would that not just cause a huge stock market or housing bubble?

  • dcacklam

    Bubbles form for 2 reasons:

    1) Massive amounts of new funding being poured into a market by new and ignorant investors (.com bubble, current price of gold, etc)

    2) Government meddling in the market creating the illusion of massive amounts of new funding in a market.

    Simply cutting taxes won’t create a bubble….

    You have to have some source of irrationality along with new funds…

    Such as the massive influx of uneducated/ignorant investors enabled by the rise of online trading, that created the .com bubble

    Or the irrationality created by government forcing the financial sector to provide home loans to those who could never hope to pay them back.