Democratic forumblogging

The Democratic candidates are answering blogger questions at Yearly Kos. I'm going to blog it and see if the universe collapses.

1:17: Richardson gets asked why he said anti-Roe Whizzer White was his model Supreme Court justice. "I screwed up on that one." Kennedy appointed him, and I figured Kennedy would appoint a decent guy.

1:20: Chris Dodd agrees with Chuck Schumer that Democrats won't approve any more Bush judges."I don't regret it, because I believed him when he said he'd respect precedent." He's learned how to be brutal or at least how to pander more effectively.

1:23: The innovations of a blogger presidential forum: instead of Clinton getting asked about universal health care she gets asked about Ezra Klein asking about universal health care. "It will be my highest domestic priority." Obviously

1:25: Obama on deficits: "This is the most fiscally irresponsible administration in… memory." (Obama was 8 when LBJ left office.) Would he deficit spend in order to eventually shrink the deficit? "Yes, but the question is, are we investing in the American people instead of in wars that should have never been waged?"

1:28: OK, the question is what you'll do about the debt. Edwards doesn't even come close to answering. "This room is filled with people who want change. Bless you for that!" He sucks up to the room with the force of a hundred hurricanes, winding up to some babble about change that gets a huge ovation.

1:30: Richardson: "These are very fine speeches but I'm a guy who's actually balanced budgets. The question was about the $9 billion deficit." He says we need to a balanced budget amendment to loud boos and hisses. Then he knocks corporate welfare: some applause. He's really taking the hammer to Edwards: "You can give speeches about change and leadership, but this is obscene. You're talking about a generation of people here…" and he's cut off.

1:34: Hah. Dodd gets a media regulation question, blasts the Dow Jones-Murdoch deal, and pounds his chest about "standing up to Bill O'Reilly!" Amid the huge applause I look over at Howard Wolfson, Hillary Clinton's communications director who went on O'Reilly to defend Yearly Kos two days before Dodd did. He sort of sets his jaw and checks his blackberry.

1:36: We don't have universal health care, says Kucinich, because "no one is going to the people. I'm ready to rally the people in the cause of universal health care!" Hooray!

1:37: Edwards: Close Gitmo no illegal spying, no secret prisons. "This government doesn't belong to the president. It belongs to yewww!" And demand that "we [Democrats[ pledge here today not to take a dime from Washington lobbyists." Watching Edwards with his audience is like watching Marcello Mastroianni massaging some lucky Italian woman's shoulders.

1:39: Aha! Mike Gravel gets asked about the Fair Tax. When the questioner describes it she gets hisses. Gravel dodges: "What you heard from the people on this stage is what you heard four years ago, eight years ago." The Fair Tax is moot: "The Fair Tax will never pass the Congress because it would dilute their power." That gets some chuckles of the "laughing-at-him" variety.

1:43: The moderator asks, basically, why won't Hillary cut the purse strings and stop the Iraq War, but in the asking she refers to "President Clinton."

"Sorry, I went back a few years," she says.

"I think it was a Freudian slip," says Clinton.

1:45: Kucinich bounces off Clinton's pander-fu, when she got some applause noting her "fight with Dick Cheney." "First of all the way we deal with Dick Cheney is that he should be impeached for lying…" and he's interrupted by an ovation.

1:47: Richardson: "I have a one point plan for Iraq: Get out! Get out!" It's really striking how the Iraq question muffles support for Hillary but boosts everyone else.

1:49: Gravel whacks Hillary again: "They say they don't have the votes? The votes are there, you just need to go get 'em!"

1:50: Obama gets a potentially tough question on whether American foreign policy bears some responsibility for 9/11. "I don't think there's an excuse for 9/11." No applause. "That was an act of evil and we need to hunt down those that perpetrated it." Some applause. "By the way, they weren't in Iraq."

1:53: Good for Matt Bai: He follows up and re-asks the question. Obama waits a bit before answering. "As I said before… there was no excuse for 9/11. But have we always acted intelligently in the Middle East? Have we always acted with respect to Muslims?" It's masterful answer, drained through a sieve to rid it of stuff Republican candidates can seize on. But Obama is quiet and academic and only when he says "Iraq" does he really light the room up.

1:54: Edwards says "I don't agree with those who say George Bush has made this country safer!" No one said that.

1:56: Clinton thinks Bai mis-asked the question. "There's not so much anti-American sentiment as there is anti-Bush sentiment." The question was about policy before 9/11, like when her husband was president… but the bloggers don't care, and they cheer.

1:58: Hm. Interesting Hillary judo flip. She says "the war on terror is not a bumper sticker," and before anyone boos she adds "it is a complicated issue." Getting to Edwards' right rhetorically without actually disagreeing with him.

2:00: Can China be a friend and competitor if its government is basically evil? Obama doesn't address that, but says we can't do anything about it if "we're their debtors."

2:05: Chris Dodd wants more Peace Corps-like programs, as does Edwards. This is an un-electrifying section.

2:06: "American foreign policy should once again stand for human rights."

2:07: "If elected will you hire an official White House blogger?" Everyone raises their hands and Edwards adds: "Her name will be Elizabeth Edwards." So that, uh, cancer thing… not so much of a problem after all.

2:09: A fun question for Gravel: "Are all Alaskan politicians corrupt, or just the Republicans?" Some are corrupt, and others subscribe to reason.

2:11: "How many of you would commit to visiting all 50 states?" Hillary doesn't raise her hand, so Obama goes to his strength on electability. If you're a junkie and you've heard a Hillary defender talk about how she can win by nabbing "Kerry plus" (the Kerry states plus Florida or Ohio)—and bloggers, by definition, are political junkies—Obama's answer is like candy. He'll visit everywhere and elect candidates everywhere. The kids love it.

2:14: Aha, Hillary tries to steal Obama's thunder by giving the same answer and mentioning her 2000 campaign in New York (where she came a mere 10 points behind Al Gore).

2:16: Here comes the electability round. Richardson tosses some red meat on voting reform and paper ballots then says "we need an electable candidate."

2:17: "We need to stop talking about the political strategy and start being the party of real change," says John Edwards, who has said he's the most electable candidate.

2:18: Hillary: "That's a position that John has certainly taken."

2:19: OK, this is good. Hillary scraps a little with the moderator to take the question, because she wants to talk about lobbyists. There are some boos. "That's good—that adds a sense of reality to me being at this convention." Then she argues, quite accurately, that lobbyists represent all sorts of interest groups including nurses (who hates nurses?) One guy tries to heckle and is shushed.

So Hillary did Sister Souljah this convention after all. She did so defending… liberal interest groups.

2:23: "Do any of you have a Washington lobbyist?" asks Edwards, smirking. Since there are some union members and AARP card-holders in the crowd, I think "yes," but that's not what he's going for.

2:24: Edwards just got in over his head. "I have never taken and will never take money from a Washington lobbyist." Someone's going to check that, I think.

2:31: Hillary will work to pass a Constitutional Amendment for public financing. So she realizes public financing is unconstitutional… but will introduce bills setting up public financing. I'm momentarily wistful for a Hillary-McCain race and the looking-glass fun it would provide.

Comments

[Michael Pack]

There are so many things wrong here.1:you don't have to be pro-life to think Roe was wrong.I guess that makes me indecent.2:Dred Scot was a precedent,want to uphold that?3:Uninversal health care requires the goverment taking of a PRIVATE industry.So much for precedent4: FDR,LBJ,Nixion,ect5:He's a attorney!!!

[Cesar]

Deficit spend to shrink the deficit? Is that liberal vodoo economics or something?

Theres one way to shrink the deficit--stop deficit spending.

[Bradford C.]

I can't tell if the voice at 1:30 is from Edwards or an audience member...

[dan]

Who said we should have a balanced budget amendment at 1:30?? You don't say.

[Grand Chalupa]

What the hell? This early? What channel?

[dan]

niiiiice gotta love richardson

[Peter K.]

"'These are very fine speeches but I'm a guy who's actually balanced budgets. The question was about the $9 billion deficit.' He says we need to a balanced budget amendment to loud boos and hisses. Then he knocks corporate welfare: some applause. He's really taking the hammer to Edwards: 'You can give speeches about change and leadership, but this is obscene. You're talking about a generation of people here...' and he's cut off."

I can tell from the pronoun you use that you're not talking about Hillary Clinton. I can also tell the "he's" really taking the hammer "to Edwards", and therefore, the he is NOT Edwards.

That leaves Gravel, Richardson, Kucinich, Dodd, Obama. Which one were you talking about?

[joshua corning]

1:30: Richardson: "These are very fine speeches but I'm a guy who's actually balanced budgets. The question was about the $9 billion deficit." He says we need to a balanced budget amendment to loud boos and hisses. Then he knocks corporate welfare: some applause. He's really taking the hammer to Edwards: "You can give speeches about change and leadership, but this is obscene. You're talking about a generation of people here..." and he's cut off.

Picture proof that libertarians lambasting Bush for cutting taxes (which increased tax revenues) but not cutting spending are in fact closet socialists.

Here it is in living color:

Dems want to increase spending AND increase taxes. At current tax levels any increase will lower revenues and cripple the economy.

Looking forward to the 2010 Great Depression II. How much you want to bet that in 2012 dems will blame it on big business?

[Dave Weigel]

I fixed the post: Richardson was the guy hammering Edwards.

[Cesar]

Now, I wonder why liberals would boo a balanced budget amendment? I thought they are for "fiscal responsibility"?

[Goldwater Conservative]

I can't stand partisan hacks. The sentiment toward the fair tax is pretty typical. Not the actual idea, but the very fact someone dares to exchange or ask for elucidation about an idea.

BTW, is a drug war question going to come up? A room of liberals and no one wants to abolish the DEA?

[Cesar]

I'm waiting for any Presidential candidate with a decent shot, of either party, to say "No new spending faster than the rate of inflation and no new tax cuts until the budget is balanced and the debt is gone".

[Michael Pack]

Bush didn't cut taxes and can't cut spending.Only Congress can and they need spending to get re-elected.

[Cesar]

Bush didn't cut taxes and can't cut spending.Only Congress can and they need spending to get re-elected.

But the president can veto such irresponsible budgets, something Bush has been totally unwilling to do.

[JasonL]

Is joe around here anywhere? No snark, I'm curious what he thinks.

[jh]

Now, I wonder why liberals would boo a balanced budget amendment? I thought they are for "fiscal responsibility"?

Liberals are for "fiscal responsibility", if you define the phrase as "slightly decreasing the rate of increase of the budget deficit, via ramping up taxes on the evil, evil rich to pay for more spending on responsible things like socialized medicine and continuing funding the Iraq war until we can end it by getting veto-proof congressional majorities and a Democratic president and some cojones, because we really are anti-war -- in Iraq -- but not Darfur"

It's just shorter to say "fiscal responsibility", yeah?

[joshua corning]

1:50: Obama gets a potentially tough question on whether American foreign policy bears some responsibility for 9/11. "I don't think there's an excuse for 9/11." No applause. "That was an act of evil and we need to hunt down those that perpetrated it." Some applause. "By the way, they weren't in Iraq."

Abdul Rahman Yasin was....and Zarqawi was there before the US invaded...but ya what the fuck ever, just make stuff as you go along.

[Cesar]

Abdul Rahman Yasin was....and Zarqawi was there before the US invaded

There are Al Qaeda in Germany, too, should we go bomb them?

Theres a difference between being in a country and the country actively harboring and giving protection to them. But nice try at Iraq War apologetics.

[joshua corning]

Liberals are for "fiscal responsibility", if you define the phrase as "slightly decreasing the rate of increase of the budget deficit, via ramping up taxes on the evil, evil rich

Taxing the rich more will not increase tax revenues they will decrease tax revenues.

No new spending faster than the rate of inflation and no new tax cuts until the budget is balanced and the debt is gone".

That might work that might not work. If you really wanted to balance the budget you would freeze spending (or track it inflation as you suggested) then cut taxes. Or even better cut spending and cut taxes.

[joshua corning]

There are Al Qaeda in Germany, too, should we go bomb them?

Is Germany funding them and giving them asylum?

[Cesar]

That might work that might not work. If you really wanted to balance the budget you would freeze spending (or track it inflation as you suggested) then cut taxes. Or even better cut spending and cut taxes.

We have had "starve the beast" since 1980, and its just increased the deficit. Balance the budget first, and when theres a nice surplus and the debt is on its way down cutting taxes would be great.

[Cesar]

Is Germany funding them and giving them asylum?

No, and Iraq sure as hell wasn't either.

Unless by "asylum" you mean, "hiding in an area the government of the said country has no control over".

[SIV]

BTW, is a drug war question going to come up? A room of liberals and no one wants to abolish the DEA?

Why would liberals want to abolish a government agency? Particularly one tasked with protecting our children.

[jh]

Taxing the rich more will not increase tax revenues they will decrease tax revenues.

Joshua, sometimes but not always. When the marginal tax rate was around 90% and Kennedy cut that rate, tax revenues shot up because at such blatantly confiscatory levels all sorts of counterproductive stuff happened. But when Clinton raised the top mariginal tax rates, the revenues went up, though much of the drop in the deficit was due to paying off Carter-era debt at sky-high levels and replacing it with much lower-interest debt. All this is compounded by an increasing population, an increasing wealthy population paying the top rate, and inflation, but at current top levels of taxation the dysfunctions caused by a tax increase of the top marginal rate is likely to be less than the take of income. The problem, of course, is that more revenue ignites more spending. If you cut spending, good things happen regardless of tax rates (assuming you had fiscally responsible congressional delegates, which we emphatically do not have.)

Sorry. Not supposed to be nuanced here. My bad.

[Grand Chalupa]

Is Germany funding them and giving them asylum?

Britain is, many of the terrorists living in its country plotting attacks have been on welfare.

[Cesar]

Really Chalupa? Those medical doctors were on welfare? Wow, the NHS must really be in trouble then!

[joshua corning]

If you cut spending, good things happen regardless of tax rates

Wrong....the Great Depression can be characterized as from going bad to worse to bad to worse. Every time FDR kept trying to pay for more programs by raising taxes the economy would get worse. Every time he would cut taxes the economy improved.

How on earth does cutting spending effect the economy? Seriously?

Taxes provide a negaticve insentive to risk and investment...what do you got?

Nothing?

Ya i thought so.

[Grand Chalupa]

Here ya go, smart guy.

http://www.slate.com/?id=2059799

[joshua corning]

Britain is, many of the terrorists living in its country plotting attacks have been on welfare.

Actually that is funny. I think Reason did a piece comparing the Paris riots to A Clock Work orange. Essentially disenfranchised youths rebelling against the state that cares for them.

The terrorism/state coddling argument is not that different.

[HowieDean, ReligiousFundamenta]

1. It's good to know that Weigel's transcription skills are in place, but perhaps he might, you know, try asking a question of his own.

2. How many of those attending were undercover FBI agents or other infiltrators?

3. Was there any pushback about HowieDean invoking religious imagery during his address to the multitudes? (Transcript at the link)

[Cesar]

Chalupa, thanks for the link but how many successful terrorist attacks in Britain were carried out by people on welfare payments?

The July 2005 attacks were by youths of a solidly middle class background, the recent attempted attack was by medical doctors.

Its often the educated middle class and upper-middle class who carry out successful terrorist attacks. Particularly, it seems, if they studied one of the hard sciences.

[Cesar]

Actually that is funny. I think Reason did a piece comparing the Paris riots to A Clock Work orange. Essentially disenfranchised youths rebelling against the state that cares for them.

That, and bored, young, unemployed men often turn to petty crime to entertain themselves. Since finding a job is impossible if you are young in France, that gives you plenty of free time to get in trouble. Its doubly hard to do so if you are not only young but also North African.

[Grand Chalupa]

The July 2005 attacks were by youths of a solidly middle class background, the recent attempted attack was by medical doctors.

Its often the educated middle class and upper-middle class who carry out successful terrorist attacks. Particularly, it seems, if they studied one of the hard sciences.

Yup, scumbags can be rich or poor. The poor ones are less likeley to be successful.

[mub]

Weigel, you incontinent chimp, this is some spectacular live-blogging. Seriously...an instant classic of the genre and a profound credit to your oeuvre.

[Dave Weigel]

It's good to know that Weigel's transcription skills are in place, but perhaps he might, you know, try asking a question of his own.

Doing that would have involved running onto the stage and yelling something. This was a forum moderated by a journalist and two bloggers using questions submitted by bloggers in advance.

[jh]

If you cut spending, good things happen regardless of tax rates

Wrong....the Great Depression can be characterized as from going bad to worse to bad to worse. Every time FDR kept trying to pay for more programs by raising taxes the economy would get worse. Every time he would cut taxes the economy improved.

How on earth does cutting spending effect the economy? Seriously?

Taxes provide a negaticve insentive to risk and investment...what do you got?

Nothing?

Ya i thought so.

joshua, I'm not disagreeing with you that higher taxes discourage investment, and cause all sorts of counterproductive economic avoidance. But the underlying level of spending matters greatly, because that is what the taxes are imposed for. The Great Depression kept staggering on because FDR kept raising spending, and then imposed higher taxes to pay for that spending. Yes, increasing taxes in that situation was absolutely a bad idea, but the welfare state spending was a worse idea, and precipitated the taxes.

If you drop the top marginal tax rate to 0%, according to you that would result in higher tax revenue. That is obvious nonsense.

Government spending must be paid for. Whichever form of paying you do causes bad things. Raising taxes -- check. Cranking up the speed of the money printing presses, caussing inflation -- check. Borrowing money, causing debt service to rise -- check.

Cutting taxes while allowing government spending to escalate, as the Republicans did, is a bad idea. Raising taxes to finance even more spending, under the guise of balancing the budget, as the Democrats want to to, is a bad idea.

Does this help, or are you gonna ignore all this and persist in having simplistic views of government finance?

[Cesar]

jh-

I think what you are saying, is that there is a law of diminishing returns in the amount that revenue would increase everytime the tax rates go lower?

I.e. a 30% tax cut from 90% to 70% would icrease revenue more than cutting the tax rate from 70% to 40%?

Cutting taxes while allowing government spending to escalate, as the Republicans did, is a bad idea

Borrowing and spending is even worse than taxing and spending, because it forces future generations to pay for the irresponsibility of their parents. Its extremely immoral.

[Henry Luce]

Doing that would have involved running onto the stage and yelling something. This was a forum moderated by a journalist and two bloggers using questions submitted by bloggers in advance.

No guts, no glory.

[Michael Pack]

cesar,I agree,but to veto these massive bills you have to 'shut down' the gov.You expect one man to take the fall for 535 others.Those kind of guts do not and can not exsist because most Americans will not stand behind them.Ron Paul would veto everything in sight,yet he would be over ridden,or impeached.

[Cesar]

cesar,I agree,but to veto these massive bills you have to 'shut down' the gov.You expect one man to take the fall for 535 others.Those kind of guts do not and can not exsist because most Americans will not stand behind them.

It seemed to work for Bill Clinton. People blamed the Congress, not the President. And they eventually passed the budget he wanted.

[Michael Pack]

BUT CLITON WAS NOT CUTTIG SPENDING,HE WANTED TO RAISE IT!I f a pres vetoed farm aid,the epa,education,roads he would be flooged.

[Cesar]

BUT CLITON WAS NOT CUTTIG SPENDING,HE WANTED TO RAISE IT!I f a pres vetoed farm aid,the epa,education,roads he would be flooged.

I realize that, but the point I was trying to make is the President (unlike Congress) has the "Bully pulpit". If a President were to go directly to the American people and told them he was forcing Congress to be responsible so future generations wouldn't face a national bankruptcy, I think it would be well-recieved. Congress rarely (if ever) wins in showdowns with the President, as we have seen in recent months with Iraq War policy.

Nevertheless, I agree that more Tom Coburns in Congress would help a great deal as well.

[jh]

I think what you are saying, is that there is a law of diminishing returns in the amount that revenue would increase everytime the tax rates go lower?

I.e. a 30% tax cut from 90% to 70% would icrease revenue more than cutting the tax rate from 70% to 40%?

Cesar -- what you are saying is essentially correct. To make your example clearer -- going from a 90% marginal top tax rate to a 60% marginal tax rate would almost certainly yield a big increase in tax revenue coming in while, say, going from a 30% top marginal tax rate to a 0% top marginal tax rate would absolutely decrease tax revenue to zero. At a certain confiscatory level of taxation, raising taxes decreases revenue. At a certain (still high) level, tiny marginal changes in taxes produce very little change in tax revenue. At low levels of taxation, slight increases in taxation produce most of the projected revenue increase and little compensatory tax avoidance behavior.

This is all complicated by whether the goods in question have elastic or inelastic demand, etc.

If you have gobs of time on your hands, daviddfriedman.com has a free online economics text that walks you through all this and much more.

[jh]

Borrowing and spending is even worse than taxing and spending, because it forces future generations to pay for the irresponsibility of their parents. Its extremely immoral.

Cesar -- depends on how you define immoral. I'm a hardcore libertarian who considers all compulsory taxation to be immoral theft, so whether it is stealing from the current generation or from future generations is all the same to me. Theft is theft.

You may have a different view of immorality and taxation, and I respect that you (and virtually everyone else) may have different views, and I'm not so arrogant as to assume I'm right and the 99% or so of the population dissenting from my extreme minority view of things is wrong. You seem to be trying hard to have a nuanced understanding of how things work, unlike some folks posting (or posing) here.

[Michael Pack]

cesar,it's easier to say 'I want to give you money',than say,enough is enough,your on your own.The Iraq war had alot of support from the public,many were still thirsting for blood from 9/11.Personally I would have left after Bagdad fell,well to the oil fields and let the Iraqis sort out their own goverment.This would have left the Kurds doing well and the shites and sunnis could fight,with no wealth in the balance.Call me cruel but the goverments in the middle east need to find out that actions have consecences.That includes the Saudi Arabia.

[robc]

jf,

Actually, what you say isnt correct. Decreasing the marginal rate from 30% to 0% would decrease FEDERAL income tax revenue to zero, but would cause a HUGE increase in state tax revenue, both income and sales. And probably a huge increase in federal excise taxes and tariffs too. And FICA.

Whether the net revenue change would be positive or negative would depend on the exact location of the peak of the laffer curve, but damn, it would be sweet to test.

[joshua corning]

Borrowing and spending is even worse than taxing and spending, because it forces future generations to pay for the irresponsibility of their parents. Its extremely immoral.

wrong. Anyone would be an idiot to wish to be born in 1930 rather then 1980.

You would also be an idiot to think we should buy an aircraft carrier all in one lump sum rather then pay for it over time as it provides its service.

The fact remains that taxes hurt the economy and hurt job creation. Deficit spending has not had anything near that kind of effect on the economy.

Don't get me wrong, we should balance the budget, but for libertarian to fall into the same arguments that the left has is a hole that leads to an FDR styled economic depression.

[Micheal Pack]

Oh,by the way,go to the public to end S.S,see how that works out.

[joshua corning]

Whether the net revenue change would be positive or negative would depend on the exact location of the peak of the laffer curve, but damn, it would be sweet to test.

robc is now the coolest guy on hit and run

[robc]

Michael,

I have yet to meet anyone under age 30 who is capable of doing basic math that isnt in favor of ending SS.

[Cesar]

Cesar -- depends on how you define immoral. I'm a hardcore libertarian who considers all compulsory taxation to be immoral theft, so whether it is stealing from the current generation or from future generations is all the same to me. Theft is theft.

My view is a little bit different from yours. I believe that limited (note: limited) taxation is a necessary evil in the same way a limited government is. A limited government arrived at by the consent of the governed to protect people from force, theft, violence, fraud, and foreign invasion requires taxation at least in a minimal form to fund it.

I wish neither things were necessary, but I am afraid the darker side of human nature makes it so. Since you are religious, you would say its the "fallen nature" of man that makes it necessary.

I think that borrowing and spending is more immoral than taxing and spending because the former is the ultimate in taxation without representation. By borrowing, we are basically forcing future generations to pay interest on a debt that they had no say in taking out, and does not benefit them in any way.

[joshua corning]

going from a 30% top marginal tax rate to a 0% top marginal tax rate would absolutely decrease tax revenue to zero.

There sure are a lot of European countries going from 40-30% down to 10-15%.

I wonder what on earth they could be thinking?

[SIV]

I have yet to meet anyone under age 30 who is capable of doing basic math that isnt in favor of ending SS.

robc-pretty small slice of voters there.

[joshua]

I have always been the coolest guy on H&R, it didnt just happen.

Maybe I should start using laffer curve arguments to convince chicks how cool I am, nothing else seems to be working.

BTW, I agree with the others, cutting taxes alone isnt the answer. But, I think we could completely eliminate the federal personal income tax without causing any revenue problems. More drastic action than that first needs radical spending cuts - there is a point where we go below the peak of the laffer curve, we just arent anywhere near it yet.

[robc]

SIV,

give it time. Eventually the boomers will die off. Right? Please tell me they arent immortal.

[joshua corning]

By borrowing, we are basically forcing future generations to pay interest on a debt that they had no say in taking out, and does not benefit them in any way.

Ya cuz the economy people are inheriting if they were born in 1980 is so much worse then the one they got if they were born in 1930.

[Cesar]

Joshua-

Don't get me wrong, I don't think taxes should be one penny higher than they already are.

But we should try to get the budget balanced before we cut them further.

[robc]

argh, that was me responding to joshua, not joshua. Ugh. I think I just lost all my coolness points. 🙁

[joshua corning]

Please tell me they arent immortal.

Sorry Dude...

http://www.amazon.com/exec/obidos/ASIN/0670033847/reasonmagazinea-20/

Maybe we should let the left regulate to death genetic research and nano technology

[Cesar]

Joshua-

Please explain how a gigantic federal debt is somehow a gift to future generations?

[robc]

Cesar,

I think the question is:

If we had a congress that was willing to hold spending in check (which hasnt existed in my lifetime), would it be EASIER to balance the budget by cutting taxes than keeping them the same?

If the current tax rate is above the laffer curve peak, the answer is yes.

[joshua corning]

Please explain how a gigantic federal debt is somehow a gift to future generations?

It isn't, but a strong growing economy and the vast wealth produced from relatively low tax rates that they will inherit is.

[Cesar]

It isn't, but a strong growing economy and the vast wealth produced from relatively low tax rates that they will inherit is.

And when does the debt get paid off? Never? We just borrow indefinitely?

[Micheal Pack]

yes,under 30,I'm 47,self employed and most people my age and older think I'm nuts.You see,I write my tax checks[and 14.93 S.EP. TAX].Old folks vote more.

[joshua corning]

And when does the debt get paid off? Never? We just borrow indefinitely?

If spending is kept at inflation levels growth will swamp any debt. Plus all indication show that we are on the wrong side of the Laffer curve...so if we cut taxes revenues would be higher, helping to pay off the debt all the quicker.

[Michael Pack]

joshua corning,unless we eliminate S.S amd medicare it won't matter.They grow and grow and are unchecked.

[Cesar]

If spending is kept at inflation levels growth will swamp any debt.

But spending hasn't been held at inflation levels. You know why? Because right now people are getting all the benefits of a warfare-welfare state without paying for it. Thats very popular with politicians, because they tell people you can have your cake (the welfare state) and eat it too (tax cuts). This does nothing but grow the deficit and debt. Which is bad for the nation in the future.

If people had to feel a tax increase every time they wanted a new spending program, all of a sudden new spending wouldn't be very popular. This is why most Democrats hate the idea of a balanced budget amendment.

[robc]

joshua,

The hard part is finding a congress that would hold spending to inflation levels. I actually think it would be easier to find a congress that will radically cut spending by eliminating unconstitutional programs.

The people who dont consider Dept of Education unconstitutional always seem to find a reason to spend more once they have been in power a few years.

[Neu Mejican]

A discussion of the extremely solid concepts that go into the Laffer curve...

http://www.everything2.com/index.pl?node_id=1225420

The truth of the matter is that the optimal tax rate for government revenue is guided by intensely immediate circumstances and numerous, nigh-uncountable variables, and all the wicked webs that make up history. Laffer's fallacy, whether conscious or unconscious, occurred when he assumed that simply because two ends of his graph could be easily examined and quantified, that the rest of the graph would follow the same rules and thus arrive at a "point". In fact, not only did the graph not follow those rules, it could not by definition of the system it represented.

[robc]

NM,

Without first reading your link (which I will after posting this), I think 3 things can safely be said about the laffer curve:

1. It is continuous at each point of [0,100]
2. It is differentiable at each point of (0,100)
[thus we can apply the Mean Value Theorem]
3. It is concave downward*

*Im not completely convinced about 3

[joshua corning]

In fact, not only did the graph not follow those rules, it could not by definition of the system it represented.

Ya...to bad history has proven that that wicked web that make up history are testable in stable Post-industrialized western cultures since this paper has come out.

The reality is that taxes have gone down in the US and Europe for quit some time and have all been precipitated by GDP growth and increase tax revenues.

The Laffer curve I imagine would look much different in Rome circa 24 BC but that does not change the effects that Thatcher's, Reagan's, Bush's and those in Ireland and Italy and even newer ones in eastern Europe have had in positive economic growth and positive tax revenue growth.

[robc]

In the link Neu Mejican gave, Gardner disagrees with my 3 points. He is wrong.

[joshua corning]

Cognitive philosopher Daniel Dennett, in his works on human consciousness, has used Laffer's fallacy and Gardner's correction to demonstrate the fallacy written in an unspoken assumption of many of his colleagues: that because there is an easy recognition of the period of time when stimulus is applied and the period of time when the subject responds, that there must by definition be a theoretical "point" wherein "conscious" recognition of the stimulus occurs, between the stimulus and the response.

I think the next time Ron our Reason science dude interviews Dennett he needs to ask him about this.

[robc]

I will try to be more rigorous about my "he is wrong" comment.

Its hard to tell from that link but Gardner is saying one of two things -

A. The laffer curve isnt a funtion.
B. The laffer curve isnt a continuous function.

I dont think the first is worth spending any time on, but I will quickly define a function for those of you who dont have an old copy of Thomas-Finney in front of them.

A function from a set D to a set R is a rule that assigns a single element of R to each element of D. Im pretty sure that with a top marginal rate of n, the feds dont collect two different amounts of revenue. So, it is a function.

For B, a function is continuous if lim f(x) [as x->c] = f(c). In other words if you change the tax rate by a very, very tiny amount does the revenue change by a very, very tiny amount? If the top marginal rate was 35.000000000001 instead of 35 would revenue be any different? This seems to be Gardner's contention - that there could be a drastic difference. This would only be the case if tax revenue was a chaotic function. (yeah, I want to make a joke here to)

Gardner is just plain wrong.

[M. Simon]

Cesar says:

Unless by "asylum" you mean, "hiding in an area the government of the said country has no control over".

So we sent a raiding party to collect the miscreants and the Iraqi government dissolves. S... happens.

[jh]

My view is a little bit different from yours. I believe that limited (note: limited) taxation is a necessary evil in the same way a limited government is. A limited government arrived at by the consent of the governed to protect people from force, theft, violence, fraud, and foreign invasion requires taxation at least in a minimal form to fund it.

I wish neither things were necessary, but I am afraid the darker side of human nature makes it so. Since you are religious, you would say its the "fallen nature" of man that makes it necessary.

Cesar -- perhaps we aren't as far apart on this as you think. Note that I said "compulsory" taxation is immoral. I think there are ways to get voluntary taxation to pay for the necessary minimal government protection against coercion, force, fraud, etc. For example, police protection -- you pay for your police premiums / taxation, or you get no police protection. If you think you can defend yourself by vigorously using your Second Amendment right to arm yourself heavily, buy private security guards, etc., that would be your right.

As for national defense, if you don't pay your voluntary taxes, your name goes on a website of people not protected by the federal government against fraud, kidnapping, murder, your wife and daughter being forced into prostitution, etc. Again, if you opt out, better use that Second Amendment to its fullest.

If you design the right incentive, everything necessary might (note I didn't say "can") be paid for via voluntary rather than compulsory taxation.

[M. Simon]

robc,

The continuity of a function implies nothing about its slope. At a large enough slope a function could appear to the casual observer to be discontinuous.

The fact that lim f(x) [as x->c] = f(c) says nothing about the rate of change of F(x) as x->c.

[Cesar]

If you design the right incentive, everything necessary might (note I didn't say "can") be paid for via voluntary rather than compulsory taxation.

I absolutely agree with that, and voluntary taxes are certainly better than compulsory ones.

Also, I think if tax rates were low enough there would be no reason for people to avoid their taxes anyway. When Estonia, for example, went to a low flat tax the problem of tax evasion--which and been endemic before that time--virtually disappeared.

[Neu Mejican]

This would only be the case if tax revenue was a chaotic function.

In order to prove Gardner wrong,
please defend your contention that the tax revenue is not a chaotic function.

[joshua corning]

"You can give speeches about change and leadership, but this is obscene. You're talking about a generation of people here..." and he's cut off.

hmm this seems to be a theme at Kos...

Check this out:

http://pajamasmedia.com/2007/08/soldier_censored_at_kos_conven.php

[joshua corning]

please defend your contention that the tax revenue is not a chaotic function.

20+ years of tax cuts in multiple countries all followed with increases in revenues and economic growth.

If it was chaotic there would be some tax cuts followed by declining revenues and economic growth

[Neu Mejican]

Joshua Corning,

The reality is that taxes have gone down in the US and Europe for quit some time and have all been precipitated by GDP growth and increase tax revenues.

"...Gardner based his curve on actual US economic data collected in a fifty year period by statistician Persi Diaconis.

The satire illustrates the major fallacy commonly committed with the Laffer curve, namely the assumption that the middle is a smooth, concave function merely because the two extreme endpoints are well-defined. A realistic tax curve would most certainly not resemble a smooth parabola or even any other simple function, but rather a very complex curve with many peaks, valleys, and multiple local maxima. Inside the middle, a wide range of various economic factors confound any simplistic attempt at this interpolation.

As a pedagogical tool, a Laffer curve helps illustrate a specific application of the law of diminishing returns, where the inhibitory cost of taxes may eventually outweigh the increased rate of taxation, and thus led to a counterintuitive lower realization of tax revenue. However the Laffer curve should not be taken as a literal model for a tax revenue curve, especially in debates between relatively moderate amounts of taxation. It is in this context that the Laffer curve is often abused, taken as a serious model for tax revenue when it has little to no predictive value in debates between intermediary rates of taxation...

http://reference.info.com/reference?qkw=Laffer%20curve&source_id=2222&source_key=Laffer+curve

[Neu Mejican]

http://www.cbo.gov/ftpdocs/69xx/doc6908/12-01-10PercentTaxCut.pdf

Changes in tax policy can influence the economy, and those economic effects can in turn affect the federal budget. Although conventional estimates of the budgetary effect of tax policies incorporate a variety of behavioral effects, they are, nonetheless, based on a fixed economic baseline. For that reason, they do not include the budgetary impact of any possible macroeconomic effects of tax policies.

This brief by the Congressional Budget Office
(CBO) analyzes the macroeconomic effects of a
simple tax policy: a 10 percent reduction in all federal tax rates on individual income. Because there is little consensus on exactly how tax cuts affect the economy, CBO based its analysis on a number of different sets of assumptions about how people respond to changes in tax policy, how open the economy is to flows of foreign capital, and how the revenue loss from the tax cut might eventually be offset.
Under those various assumptions, CBO estimated
effects on output ranging from increases of 0.5 percent to 0.8 percent over the first five years on average, and from a decrease of 0.1 percent to an increase of 1.1 percent over the second five years. The budgetary impact of the economic changes was estimated to offset between 1 percent and 22 percent of the revenue loss from the tax cut over the first five years and add as much as 5 percent to that loss
or offset as much as 32 percent of it over the second five years.

[joshua corning]

However the Laffer curve should not be taken as a literal model for a tax revenue curve, especially in debates between relatively moderate amounts of taxation. It is in this context that the Laffer curve is often abused, taken as a serious model for tax revenue when it has little to no predictive value in debates between intermediary rates of taxation...

Um I am proposing a 50% income tax cut from the top end from 35% down to 10-15%. These are not moderate cuts. Neither where the Tax cuts enacted by Reagon or Bush jr or by Thatcher...neither are the tax cuts being installed in Eastern Europe.

I think robc already nailed you on this one.

yup he sure did:

If the top marginal rate was 35.000000000001 instead of 35 would revenue be any different?

[Neu Mejican]

From 2005

http://www.sciencedirect.com/science?_ob=ArticleURL&_udi=B6W5H-4GY874K-1&_user=10&_coverDate=10%2F31%2F2005&_rdoc=1&_fmt=&_orig=search&_sort=d&view=c&_acct=C000050221&_version=1&_urlVersion=0&_userid=10&md5=e2b95eac19f3fd0015dbac6bf9d69324

According to Laffer, economic activities are a decreasing function of the taxation rate. As a consequence, total tax revenue increases with the taxation rate at its lower levels and decreases against it at its higher levels. The result is the Laffer curve. According to him, the reason for this decrease lies in decreasing economic activities. Although this may be true for activities in the official (white) sector, in the unofficial (black) sector they can increase under the influence of an increasing taxation rate. Part of the Laffer effect may be nothing more than an activity switch away from the white towards the (hidden) black sector. This paper takes both effects into account: decreasing activities in the white sector combined with increasing activities in the black sector. It examines the computation of the maximum tax revenue generating taxation rate for a number of OECD countries. It concludes that, with the exception of Sweden, the marginal taxation rate in these countries is below its optimum.

[joshua corning]

a 10 percent reduction in all federal tax rates on individual income.

This is interesting because Bush Jr tax reduction on the top end was ~13% and we are now experiencing record tax revenues.

looks like the CBO's assumptions were dead wrong.

[Neu Mejican]

Joshua,

Your model is ignoring other factors...

Neither where the Tax cuts enacted by Reagon or Bush jr or by Thatcher...neither are the tax cuts being installed in Eastern Europe.

Look to the Fed. Starting in the middle of 1981, the Fedstarted lowering the discount rate from 12% (to something like 8%). The economy started growing after the Federal Reserve started cutting interest rates. It is easy to assign that growth to tax cuts only if you ignore important features of the economy.

[Neu Mejican]

In other words Joshua,

Things are not a simple as you pretend.
I am not arguing over the broad-brushed point, just your taking it to mean that all tax-cuts are good. Things are more nuanced than that.

[joshua corning]

Part of the Laffer effect may be nothing more than an activity switch away from the white towards the (hidden) black sector.

yeah cuz after the Tax cut I won't be doing anymore under the table land deals that are recorded at the county court house...you know the ones I don't pay taxes on...and that extra 15% of cash I get I will not reinvest...i will simply flush down the toilet.

[Neu mejican]

The way to increase tax revenue is to increase GDP. Sometimes tax cuts can do that. Sometimes they won't. It depends on the particulars of the economy and the particulars of the tax cut.

A simple point.
In reality it is closer to a chaotic function.
Still haven't seen any attempt to prove otherwise.

[joshua corning]

A simple point.
In reality it is closer to a chaotic function.
Still haven't seen any attempt to prove otherwise.

Show a tax cut that was followed by declining GDP and declining tax revenues.

Always up is not chaotic...it is predictable.

[Neu Mejican]

Ah,
I see.
A statement is an attempt at proof.

[Neu Mejican]

http://www.cbpp.org/1-25-05bud.htm
http://www.cbpp.org/7-10-07tax.htm

[Neu Mejican]

http://www.cbpp.org/3-8-06tax.htm

I am not, btw, saying these cbpp analyses are correct... But they would be an example of how you demonstrate a position using data.

[Ammonium]

A few years ago I remember reading about some study of the Laffer curve which found that almost everybody was on the rising part of the curve. That meant that if you raised taxes you would raise revenue.

The catch was that the wealthiest people were on the descending part of the curve, so lowering their taxes would increase revenue.

It makes sense -- most people are not going to change their behavior very much with small changes in taxes, so a tax increase seems like it could raise revenue. But rich people tend to have a lot more discretion since they are more likely to earn money off of capital. Raise taxes and they'll redistribute the capital in order to avoid taxes and reduce risk now that they aren't getting as good a return on their risk.

[Underzog]

Where have you guys commented on or supported that soldier who was shouted down by John Stoltz?

It gives lie to the claim that the Lib/Commies support the troops but oppose the war.

Maybe you Roehmites agree with Stoltz in shouting that military person down who dared to speak in favor of our mission in Iraq. Maybe the Reasonoids aren't hypocritical like the rest of the left and you guys oppose the troops and their mission.

If so, I salute your honesty /sarc

"There's no need to fear; Underzog is here!" (Don't forget the "Underdog" movie has just come out)

[Fritz]

I thought we were more concerned with getting rid of the need for so much taxation, not just figuring out ways to increase tax revenue. If the government was downsized to its proper functions, then the tax rate could eventually be decreased in proportion. (And this would have the side effect of increasing productivity, thus increasing revenue anyway, making the ideal state a very cheap burden on everyone)

Why you should vote Democrat in this election: a Democrat is willing to tax in order to spend, and a Republican is not. Under Republican deficit spending we saw a good economic climate, making most people unconcerned with the fall that will eventually take place. Under Democratic tax-and-spending people will feel the heavy hits almost immediately and perhaps then finally get the message: spending is VERY BAD, and outweighs ANY potential benefit of the new program being funded.

Thus the strategy shouldn't be to vote for the lesser of two evils, but the greater, in order to get through faster to the majority the fact that they ARE evil.

(Case in point: Herbert Hoover's government interventionism was the initial cause of the Depression, yet most people regard him as the "laissez-faire president". A nice warm-up to secure FDR 12 years of disastrous mismanagement under the guise that Hoover's "failure to intervene" put America there in the first place)

[joshua corning]

Maybe the Reasonoids aren't hypocritical like the rest of the left and you guys oppose the troops and their mission.

look up to here:

joshua corning | August 4, 2007, 6:57pm | #

and offsite and offpage here:

http://pajamasmedia.com/2007/08/soldier_censored_at_kos_conven.php#c059741

[joshua corning]

oh crap did I just respond positively to a holocaust denier....

Fuck me.

[joshua corning]

Thus the strategy shouldn't be to vote for the lesser of two evils, but the greater, in order to get through faster to the majority the fact that they ARE evil.

I thought that was the reason for voting for them in 2006....in fact i seem to remember a bumper sticker

Vote Dem in 2006: To see how crazy they really are.

Or some such thing

[jh]

Fritz -- I'll pass on the "vote for the worst possible bastards possible in the hope they'll screw things up so bad that, in revulsion, most people will become libertarians" strategy -- might be a few unintended consequences there, if you think hard about it for a second or two.

[grumpy realist]

My solution to the entire problem:

1) Cut military spending in half.
2) Raise age for Social Security, lower payments (slightly)

3) Balanced budget amendment, maybe with a bit of a waffle factor

4) Cut corporate taxes to zero BUT make them entirely pass-through, like with an LLC.

5) Same tax rates for earned income and passive income

6) Increase allowable amounts for IRA drastically to encourage savings.

7) Socialized health insurance. As far as I can tell, we are incredibly inefficient with health insurance. Too damn much of each dollar paid goes to administration, health insurance company profits, and salaries for health insurance flunkies looking for reasons to deny payments. Screw all that. I want any health insurance I pay to get paid out in payments on strict salaries to doctors to take care of people. Put in a little bit of tracking, so you can tell whether a treatment is working or not, but stop this ghastly "oh were going to suddenly jerk your health coverage simply because we think you may have had a prior condition." Plus, we're ended up tying people to particular employers because they don't dare leave due to health insurance problems. So much for freedom....

[robc]

I havent got a chance to respond until now, due to being named the coolest guy on H&R, I had to haul a keg of homebrewed dunkelweizen to a party.

please defend your contention that the tax revenue is not a chaotic function.

As I cant run multiple experiments on identical economies, I have to do it via gedanken experiment:

I will use the example I did before,
Assume that with our current 35% top end marginal tax rate that X billion dollars are collected.

If the rate was instead 35.00000000001% would the rate be very, very, very near X (maybe a few cents different) or would it be more like 17X or .2X?
How about for 34.9999999999999999%?
What about 35.00000000000002?

If tax revenue was chaotic (and I mean this in the strict mathematical sense), the revenue collected with those different tax rates would be unrelated to each other. The graph wouldnt form a smooth curve.

Chaos regimes are rare enough that I would need to see an explanation of why tax revenue was chaotic before I could accept it.

A realistic tax curve would most certainly not resemble a smooth parabola or even any other simple function, but rather a very complex curve with many peaks, valleys, and multiple local maxima.

That is possible, I said originally that I wasnt sure I accepted the concave downward premise. However, nothing you said here violates the fact that the laffer curve is a function, is continuous, and is differentiable. Thus the mean value theorem applies.

Since the end points are both at zero, the MVT says there must be some point (and maybe more than one) in between in which the 1st derivative is zero, and thus there is a global maximum (or minimum - in the case that tax revenue is negative at all points - I dont want to exclude that possibility 🙂 )

[TJIT]

The tax conversation on this thread has been interesting.

I would like to hear what the democrats had to say on the number of regulations and the negative impact they have on economic performance and therefore government revenue.

[Neu Mejican]

robc,

Your responses are closer to relevant, but, imho, avoid the underlying concept. A chaotic function does not need to be as sensitive to change as you imply. The reason for the chaotic relationship between GDP, revenue and tax rate is because there are so many other factors impacting the outcome. The tax rate is not causal, does not explain enough of the variance, etc....so the outcome for a particular tax rate will not be predictable from that tax rate. It will appear chaotic.

But mathematically, you have not provided anything even approaching a counter argument. A chaotic function does not need to follow your assumption that the function would be as sensitive to very small changes as the ones you present.

[Neu Mejican]

In other words, the "all thing being equal" premise that underpins the laffer curve function is not a reasonable premise.

[Underzog]

Smear me as a holocaust denier, eh? Buth that's okay because reputations only exist in the mind of the person.If you're talking about the website I have, you should look at it if you believe it's holocaust denial. At least you were smart enough to raise the issue of the shouted down soldier so I can't believe you're that stupid.

"There's no need to fear; Underzog is here!" (and don't forget the "Underdog" movie, too.)

[Neu Mejican]

Underzog,

I reject the revisionist Underdog. Long live Overcat!

[Neu Mejican]

robc,

Some info on noise in chaotic systems.

Thomas L. Carroll Chaotic systems that are robust to added noise Chaos 15, 013901 (2005)

Jean-Philippe Bouchaud The subtle nature of financial random walks Chaos 15, 026104 (2005)

Weihong Huang On the long-run average growth rate of chaotic systems Chaos: An Interdisciplinary Journal of Nonlinear Science -- March 2004 -- Volume 14, Issue 1, pp. 38-47

[robc]

New Mejican,

A chaotic function does not need to be as sensitive to change as you imply.

Are you unfamiliar with chaos theory? Thats exactly what it would need to be:

For a dynamical system to be classified as chaotic, most scientists will agree that it must have the following properties:

* it must be sensitive to initial conditions,
* it must be topologically mixing, and
* its periodic orbits must be dense.

Sensitivity to initial conditions means that each point in such a system is arbitrarily closely approximated by other points with significantly different future trajectories. Thus, an arbitrarily small perturbation of the current trajectory may lead to significantly different future behaviour.

In other words, the "all thing being equal" premise that underpins the laffer curve function is not a reasonable premise.

Sure it is. In fact, since the laffer curve is a single independent variable graph, the assumption that all other independent variables are held constant must be assumed. Of course the laffer curve is different when t and p change (t and p being time and place 🙂 ), but that isnt the point, in any given situation, there is a smooth laffer curve with a maximum.

[Neu Mejican]

robc,

Any system, chaotic or not, will have a degree of tolerance for noise meaning that "arbitrarily small" has to be big enough for the system to "feel" it.

And sorry, just because the laffer curve requires the assumption that all other independent variables are held constant does not mean that it is a reasonable assumption to operate under when talking about shaping tax policy. The reality is that a particular tax cut/increase will have outcomes based on that cut in the context of a dynamic chaotic economy. That was Gardner's point, as I read it. Not that "all things being equal, the relationship of tax rate operates as a chaotic function." Gardner was specifically attacking the validity of the "all things being equal" premise.

[robc]

Any system, chaotic or not, will have a degree of tolerance for noise meaning that "arbitrarily small" has to be big enough for the system to "feel" it.

Not in a pure mathematic sense. Maybe out in meat space, that is true. But, there is no small too small for a true chaotic system in the mathematical sense.

To quote myself from 15 years ago: "Theory is always right, sometimes reality is wrong."

[Underzog]

The site is a joke site ridiculing holocaust denial. You guys are on drugs; ergo, you cannot reason or even perceive reality properly.

I will not take off this joke site that claims the moon does not exist, the Irish Potato Famine never happened, and Canada destroyed the twin towers just because you chaps are in too much of a drug induced fog to understand it correctly.

"There's no need to fear; Underzog is here!" (The "Underdog" movie is here, too!)

[Neu Mejican]

robc,

To be more precise. The changes that lead to poor predictive accuracy for a particular tax policy have to do with the very real likelihood that the initial conditions under which choice A and Choice B will be implemented will be arbitrarily different, unknowable to sufficient accuracy to be meaningfully modeled with a deterministic model, and more influential on the outcome than the tax policy itself.

[Neu Mejican]

Not in a pure mathematic sense. Maybe out in meat space,

Pretty sure that tax policy is implemented in "meat space."

;^)

Sorry if we were talking at different levels of abstraction. I can't imagine why anyone would have a discussion about tax policy abstracted away from meat space.

As far as the purely mathematical sensitivity to change... any arbitrarily small changes will have an effect, but that change may not be significant within the time frame of the prediction, so even in a purely mathematical sense, there is a tolerance for noise in a chaotic system. Or am I missing something here?

[robc]

Neu Mejican,

In meat space, there is no need to discuss laffer curves and etc. Tax policy is easy there: the income tax is immoral, thus it should be eliminated.

The theoretical world where you can hold lots of independent variables constant and dont have to deal with morality is much more interesting.

[robc]

The changes that lead to poor predictive accuracy for a particular tax policy have to do with the very real likelihood that the initial conditions under which choice A and Choice B will be implemented will be arbitrarily different, unknowable to sufficient accuracy to be meaningfully modeled with a deterministic model, and more influential on the outcome than the tax policy itself.

I would agree with that, but we are talking science and math here. The scientist would choose both a and b under the same conditions just to see what the effect was. Its a bit hard to do lab type experiments in econ though. Hence the use of gedanken experiments. I do agree that reality has too many variables that get in the way, but that doesnt make the laffer curve non-smooth, it just means we arent smart enough to control for the other variables (which may have a bigger affect on the result than tax rate anyway - but that doesnt matter, we arent discussing them).

As far as the purely mathematical sensitivity to change... any arbitrarily small changes will have an effect, but that change may not be significant within the time frame of the prediction, so even in a purely mathematical sense, there is a tolerance for noise in a chaotic system. Or am I missing something here?

No, but I think this improves my point. Even if tax revenue is chaotic, it acts as a continuous function within the course of a single budget cycle so can be treated as non-chaotic. Since tax rate are redetermined each budget cycle (even if the default is change nothing), there would be a new continuous laffer curve each time to work from. That individual budget cycle laffer curve wouldnt look like Gardners neolaffer curve if we were smart enough to calculate it with the other variables held constant.

[joe]

You want a laugher curve?

Reading joshua corning assert that restoring the tax code to what it was in the 90s would cause a Great Deprssion made be double over in laughter. Does that count?

I mean, still clinging to what conservatives were saying about Clinton's economic policies in 1993, after having been definitively proven wrong for a decade? What's next, claiming that Saddam Hussein was harboring Al Qaeda again?

[joe]

Whoa. Look at that.

As low as my opinion of Bush-bots falls, it never manages to descend to reality.

[VM]

"You want a laugher curve?"

LOL!

in honor of that great line, hier is the latest book from the URKOBOLD series.

[joshua corning]

This:

http://apnews.myway.com/article/20070805/D8QQNQM00.html

Plus raising taxes to pre-bush levels would be more, yes?

and they haven't even made it to the white house.

Your assertion that Dems will stop at pre-bush levels is absurd.

What's next, claiming that Saddam Hussein was harboring Al Qaeda again?

actually my claim was terrorists...you do know that there are other Islamic terrorists besides Al Qaeda right?

[Neu Mejican]

robc,

I think we have come to accord here.

Note, importantly, that Gardner's neo-laffer curve is based on empirical data. It is the not a correction to the laffer curve holding everything else constant... it is a representation of the relationship of revenue to tax as in manifests in meat space.

but we are talking science and math here

Yeah. My view of science is that it uses math to describe the meat space. Assumptions that make the math clean make it fairly useless for explaining the dirty meat space world.

No, but I think this improves my point.

I don't, actually, think it does. The resolution problem can be pointed out in terms of the variable time, but it can also manifest in other domains. Like I said before, in order for an initial condition to have an impact on a chaotic system, the change has to be within the range of resolution that matters to the system. Your examples to illustrate that taxes were not chaotic in relation to revenue were orders of magnitude smaller than would make a difference to the sensors in the system (people making economic decisions). Even as a purely mathematical example it fails for this reason.