04 Nov 08
1 edit
This article was written by a man named Arthur Laffer in the Wall Street Journal.
http://online.wsj.com/article/SB122506830024970697.html
Here is a taste
"If you don't believe me,just watch how Congress and Barney Frank run the banks. If you thought they did a bad job running the post office, Amtrack, Fannie Mae, Freddie Mac and the militray, just wait til you see what they do with Wall Street.
Some 14 months ago, the projected deficit for the 2008 fiscal year was about 0.6% of the GDP. With the $170 billion stimulus package last March, the add-ons to housing and agriculture bills, and the slowdown in tax receipts, the deficit for 2008 actually came in at 3.2% of GDP, with the 2009 deficit projected at 3.8% of GDP. And this is just the beginning.
The net national debt in 2001 was at a 20 year low of about 35% of GDP, and today it stands at 50% of GDP. But this 50% number makes no allowances for anything resulting from the over $5.2 trillion guarantee of Fannie Mae and Freddie Mac assets, or the $700 billion Troubled Assets Relief Program (TARP). Nor does the 50% number include any of the asset swaps done by the Federal Reserve when they bailed out Bear Sterns, AIG and others.
But the government is not finished. House Speaker Nancy Pelosi and Senate Majority Leader Harry Reid -- and yes, even Fed Chairman Ben Bernanke -- are preparing for a new $300 billion stimulus package in the next Congress. Each of these actions separately increases the tax burden on the economy and does nothing to encourage economic growth. Giving more money to people when they fail and taking more money from people when they work does not increase work. And the stock market knows it."
I would just like to add that you also hear ramblings about individual states going bust and asking for Federal money to help bail them out as well. It would seem that there is no end to the spiral into an abyss of debt and the end game is not looking pretty.
04 Nov 08
Originally posted by whodeyThe age of prosperity was over the moment W took office. You aren't paying attention.
This article was written by a man named Arthur Laffer in the Wall Street Journal.
http://online.wsj.com/article/SB122506830024970697.html
Here is a taste
"If you don't believe me,just watch how Congress and Barney Frank run the banks. If you thought they did a bad job running the post office, Amtrack, Fannie Mae, Freddie Mac and the militray, just w ...[text shortened]... t there is no end to the spiral into an abyss of debt and the end game is not looking pretty.
04 Nov 08
Originally posted by whodeyHere's the most important kernel from the Laffer story: "Whenever the government bails someone out of trouble, they always put someone into trouble, plus of course a toll for the troll. Every $100 billion in bailout requires at least $130 billion in taxes, where the $30 billion extra is the cost of getting government involved."
This article was written by a man named Arthur Laffer in the Wall Street Journal.
http://online.wsj.com/article/SB122506830024970697.html
Here is a taste
"If you don't believe me,just watch how Congress and Barney Frank run the banks. If you thought they did a bad job running the post office, Amtrack, Fannie Mae, Freddie Mac and the militray, just w ...[text shortened]... t there is no end to the spiral into an abyss of debt and the end game is not looking pretty.
04 Nov 08
Originally posted by der schwarze RitterFor the sake of Americans, I hope he does spread the wealth around more, however I don't think Obama will jeopardize his re-election by raising taxes too much. What you fail to realize is that:
After Obama gets elected and runs this country into the ground "spreadin' the wealth" around, you'll be begging for W's return.
1. As people have higher incomes, they will spend their money on things they need less, in other words, for every additional dollar someone receives, they get less wealth in return. And since people cannot privately acquire collective goods, this results in an inefficient allocation of capital and labour if taxes are too low. Also, this results in a net wealth gain simply be redistributing wealth, because the poor spend their money more efficiently than the rich (the poor are unlikely to purchase wasteful goods like Rolexes and Ferraris).
2. As people make more money, they will also tend to spend more money importing goods: the poor spend most of their money domestically, stimulating the national economy, while the rich spend a greater portion of their money importing decadent luxury goods and going abroad on holiday, decreasing the GDP.
04 Nov 08
Originally posted by der schwarze RitterYour country is already run into the ground. Mr. Obama will hit the breaks and you will cry out that it's all his fault. And that's why it probably will never get better. It's a short term blame game and not a lets-see-about-the-long-run game.
After Obama gets elected and runs this country into the ground "spreadin' the wealth" around, you'll be begging for W's return.
And I'm pretty sure no Democrat will beg for W's return. The man was, is, and never will be fit to run a country. Sorry to say it DSR. McCain should have won against him.
04 Nov 08
Originally posted by KazetNagorraWhy do you assume that raising taxes and redistributing some of the money will make people have higher incomes? In the long run, higher taxes will cause workers to lose jobs and have fewer pay raises. More importantly, there will be less capital for people to start new businesses or expand old ones, meaning slower growth, or no growth in the economy. Your understanding of economics appears to be on par with Obama's.
For the sake of Americans, I hope he does spread the wealth around more, however I don't think Obama will jeopardize his re-election by raising taxes too much. What you fail to realize is that:
1. As people have higher incomes, they will spend their money on things they need less, in other words, for every additional dollar someone receives, they get ...[text shortened]... of their money importing decadent luxury goods and going abroad on holiday, decreasing the GDP.
04 Nov 08
1 edit
Originally posted by der schwarze RitterI didn't say higher incomes, I said higher wealth. Wealth does not depend linearly on income (this is easily understood: who benefits more from $1 extra income, a beggar or a millionaire?).
Why do you assume that raising taxes and redistributing some of the money will make people have higher incomes? In the long run, higher taxes will cause workers to lose jobs and have fewer pay raises. More importantly, there will be less capital for people to start new businesses or expand old ones, meaning slower growth, or no growth in the economy. Your understanding of economics appears to be on par with Obama's.
Your latter point has already been refuted by me multiple times, if higher taxes cause unemployment and low wages, explain why Norway, which has some of the highest taxes and most extensive social security systems in the world, has both lower unemployment ( 2% ) and higher average incomes (roughly 20% higher GDP per capita) than the US.
04 Nov 08
Originally posted by KazetNagorraThe United States is a very large, diverse, dynamic country -- comparing it to Norway is like comparing apples to oranges. Per capita, Norwegians may seem to be doing better, but that is easy to do when you have a small, homogeneous, close-knit population like Norway's. I'm sure that if you compared Norway to Utah or Minnesota, those two states would compare much more favorably than the United States as a whole.
I didn't say higher incomes, I said higher wealth. Wealth does not depend linearly on income (this is easily understood: who benefits more from $1 extra income, a beggar or a millionaire?).
Your latter point has already been refuted by me multiple times, if higher taxes cause unemployment and low wages, explain why Norway, which has some of the highe ...[text shortened]... unemployment ( 2% ) and higher average incomes (roughly 20% higher GDP per capita) than the US.
04 Nov 08
Originally posted by der schwarze RitterI knew this reply would come, now compare to the inhomogeneous population of Holland (3% unemployment, 20% of the population consists of immigrants or children of immigrants). Your argument that Norway is better off because it's small (its area is quite large and it's thinly populated) is invalid since there are many small and poor countries.
The United States is a very large, diverse, dynamic country -- comparing it to Norway is like comparing apples to oranges. Per capita, Norwegians may seem to be doing better, but that is easy to do when you have a small, homogeneous, close-knit population like Norway's. I'm sure that if you compared Norway to Utah or Minnesota, those two states would compare much more favorably than the United States as a whole.
In any case I am interested in the data for Utah and Minnesota and see how they compare to Norway.
04 Nov 08
Originally posted by CliffLandinAbsurd. Prosperity ended under Reagan, but has been propped up artificially by the Wall Street bubble (now collapsing) and new technologies that help the economy as a whole, but a tiny fraction of the populace as a whole (while increasing the costs of necessities that now include state of the art computing and high speed internet).
The age of prosperity was over the moment W took office. You aren't paying attention.
04 Nov 08
Originally posted by der schwarze RitterPerhaps Alar coated apples or irradiated oranges ...
The United States is a very large, diverse, dynamic country -- comparing it to Norway is like comparing apples to oranges.
You might have said, it's as comparing chestnuts to the entire potpourri. Then, your figure of speech would help make your point.
04 Nov 08
Originally posted by der schwarze RitterA bailout which is happening on BUSH's watch, remember.
Here's the most important kernel from the Laffer story: "Whenever the government bails someone out of trouble, they always put someone into trouble, plus of course a toll for the troll. Every $100 billion in bailout requires at least $130 billion in taxes, where the $30 billion extra is the cost of getting government involved."
The Republicans get to wear this albatross around their necks.