If You Read One Thing [***] About How Out-of-Control Gov't Spending Is, How Similar Reps Are to Dems, & Why We Can't Wait to Fix Things, Read Rand Paul's Floor Speech from Yesterday!

Here's Sen. Rand Paul, talking on the floor of the Senate yesterday. Snippets:

If we were to adopt the president's approach, we would have $1.65 trillion deficit in one year. If we were to adopt our [the Republican leadership's] approach, we're going to have a $1.55 trillion deficit in one year. I think both approaches do not significantly alter or delay the crisis that's coming.

Now, it's interesting when we talk about cuts, everybody seems to be giddy around here, saying this is the first time we have talked about cuts.

Well, it is better and it sounds good, but guess what? We're not even really cutting spending. What we're talking about is cutting the rate of increase of spending. The base line of spending is going to go up 7.3 % according to the CBO.

We're talking about reducing that increase to 6.7% increase. We're talking about cutting the rate of increase of government. The problem is it's not enough….

We have increased military spending by 120% since 2001. We have doubled military spending.

Now, I'm for a strong national defense. I believe that it is a constitutional function of the federal government to provide for our national defense. I think it is the pre-eminent power, the pre-eminent enumerated power, the thing we should be doing here. But even that being said, we cannot every eight years double the Defense Department, double the military spending….

do we want to have government by crisis?

Already we can't even pass a budget. We can't pass appropriations bills. Our bills do not even go to the committees anymore. They just come to the floor and we put a patchwork quilt on them and there's a chance this ends up being two more weeks. It is not the way you should run government….

I recently proposed $500 billion in cuts and when I went home and spoke to the people of my state, spoke to those from the Tea Party, they said, $500 billion is not enough and they're right.

$500 billion is a third of one year's problem.

Up here that's way too bold, but it's not even enough.

Whole thing here.

Meanwhile, we've got jackasses talking about the need to preserve tax-funded cowboy poetry slams and other tiny trims that have been too long in coming.

Here's how to balance the budget without raising taxes or gutting essential services (which doesn't include cowboy poetry, fyi).

Reason on Rand Paul.

[***]: And if you want to read two things today about Rand Paul, make sure to check our former Reason intern Mike Rigg's profile at The Daily Caller.

Comments

[Vy Kracke]

do we want to have government by crisis?

Ready or not ....

[hmm]

But I like cowboy poetry.

[Harry Reid]

Don't worry, hmm. The phrase "cowboy poetry by crisis" is not in my lexicon.

[Old Mexican]

Meanwhile, we've got jackasses talking about the need to preserve tax-funded cowboy poetry slams

Leave Harry alooooooooone!!!!!

[hmm]

What will I use my assless chaps and red boots for if we don't have cowboy poetry?

[Irresponsible Hater]

ALL CHAPS ARE ASSLESS!
"ASSLESS CHAPS" IS REDUNDANT!

[Kim Kardashian]

You lie!!

[creech]

Most Americans don't love the guy who takes away the spiked punch bowl just as the party gets interesting. Rand Paul stands a fair chance of becoming the left's next hate-object and of being shunned by establishment Republicans.

[Crisis SWAT Team]

** kicking down door & shooting dog **

We got word there's a spiked punch bowl at this party!

[robc]

Apparently KY has more tea party voters than establishment republicans in the GOP (Paul's primary opponent and obvious next-in-line guy was a McConnell guy). So not sure that matters.

And the establishment guys fall in line in the general election.

[air max france]

well

[Rich]

You are a min of few works.

[CoyoteBlue]

Mean-spirited, draconian, yada, yada, yada.

Here is Princess Ardala of the Draconia Empire for your edification.

She'd cut your little cowboy poetry slam.

[Future Youngster]

Hey, that's Justin Bieber, all grown up!

[Old Mexican]

Love the picture of him in his bermuda shorts! Brings the guy more to Sunday barbecue/beer/footbal/red neck territory!

[Mike Laursen]

Suppose so, but what would be really cool is if the Senator from Kentucky showed up in a buckskin coat with a big-ass Bowie knife sheathed at his side.

[Mainer]

That's the outfit Rand Paul originally planned for his Letterman appearance.

[Tulpa]

Maybe he was just trying to keep his pants unwrinkled by sitting in his boxers.

[web hosting]

Thas is so good. I like this. Thnaks.

[izrada internet stranica]

I like this article.Thanks

[Mainer]

So what should I do to get ready for when the Greek style crisis comes ?
Besides the guns and ammo, I mean.
How do I preserve my savings ? Buy gold ? Silver ? 99% of the public is asleep on this issue, but if we can see it coming, what's to be done ?

[Formula 409]

Pitfalls are nice. warn yr friends, tho...

[CatoTheElder]

The best investment for the ultimate meltdown is single malt Scotch whisky.

If the ultimate meltdown is catastophic at the Armegeddon level, you'll need it and so will everybody else. High quality Scotch will be rare and more desirable than gold or silver, and worth a lot in trade.

In the more like case of an ultimate meltdown of lesser scale, your investment will still be more valuable due to inflation and inevitable increases in sin taxes.

Even if things work out okay, you can still drink your Scotch whisky, which has a lot more utility than staring and handling a few gold coins.

[alan]

Being able to manufacture a half decent ecstasy knockoff by campfire will be my winning strategy.

[fresno dan]

twinkies.
The Hostess kind, cupcake.
Sweet, and incapable of rotting, this sweet, but mysterious food will sustain you when the thin line of civilisation has collapsed.

[db]

Four words:

Cowboy poetry traveling show.

[?]

Rand Paul stands a fair chance of becoming the left's next hate-object and of being shunned by establishment Republicans.

Being a lefty hate object is opt-out.

The GOP, with some in-the-breach help from the Dem/media hive (and its always-useful cosmotarian groupies), did manage to knock Paul's support down about twenty points from the 75% he was polling after the KY primary. If the Republicans can find a Murkowski-like local dynasty character to monkeywrench the next election, they can throw the seat to the Ds. They're scouting.

[Nick]

I hope Rand Paul likes to say "I told you so" because his proposal won't even happen much less what needs to happen. in 5 years he's gonna go all gangsta and be like "mothafuckas didn't listen, now y'all like oh shit and I be like I brought it 5 years ago and you bitches punked yoself."

OK, I hope that actually happens.

[DesigNate]

That would be an EPIC event on C-SPAN.

[Kool]

Sixteen bil the bill and three trill' in the hole
Rand Paul's straight logic is vulcan type cold
now they droppin and yellin
it's a tad bit late
Rand Paul and his pops had to legislate

[fullmetaltrousers]

WIN.

[x,y]

Dated, but nice. No Weezy?

[P Brooks]

We have increased military spending by 120% since 2001. We have doubled military spending.

According to Senator Paul's esteemed colleague Mitch McConnell, it would be irresponsible to cut defense spending by a single penny. We'd be sitting ducks.

[Synthia@Israel]

At least he seems to be honest while so many other politicians simply flog a dead horse. But his honesty won't solve the problem of spendings.

[Union worker]

My union representatives demanded a 5% raise, and my paycheck only increased by 3%.

That's a 2% reduction in pay!
Damn Republican thieves!

[lgm]

Of course there is an answer. Raise taxes. Clinton balanced the budget without destroying the economy.

[R C Dean]

Clinton balanced a budget during an economic boom, starting with a baseline deficit somewhere south of, what, 20% of the current deficit?

[greg jules]

This has been refuted ad naseum

[greg jules]

...that raisng taxes would help anything

[Tony]

How so?

Most of the problem is lower revenue, due to the economic downturn and reckless tax cutting. The stimulus spending will go away. The tax cuts won't. If you're actually serious about addressing the BUDGET and not just pet political causes (I'm talking to you Rand Paul), then you have to be open to tax increases.

[ftfy]

If you're actually serious about addressing the BUDGET and not just pet political causes (I'm talking to you Rand Paul Harry Reid), then you have to be open to tax increases cutting spending.

[R C Dean]

Most of the problem is lower revenue, due to the economic downturn and reckless tax cutting.

(1) Then why the vicious opposition to cutting the budget back to 2008 levels, a budget that predated the worst of the downturn?

(2) Let's run the numbers:

2011 deficit: $1,700BB

Tax cuts: $120BB

The only tax cut is the 2% payroll tax holiday. Maintaining the tax rates, deductions, etc. from 2010 through 2012 is not a cut.

Economic Downturn: $323BB

This one is hard to figure, but lets take the recent high (2007) receipts ($2568BB) and give them a 3% growth rate (for 2011, $2,890BB), compared to projected 2011 receipts ($2,567BB). Numbers from

http://www.taxpolicycenter.org.....?Docid=200

So, you back out the Obama payroll tax cut and the economic downturn, and you still have a deficit of $1,257BB.

[Tony]

Maintaining the tax rates, deductions, etc. from 2010 through 2012 is not a cut.

You fucking know what I'm talking about. Christ you guys and your pet politicians dance around taxes in such an obviously dishonest way.

Bottom line, if you can't accept letting the Bush tax cuts expire, you aren't serious about the budget. That's not the whole solution, but it's an obvious part of it. Keeping them in place means you're an ideologue who's actually not serious about the budget itself, but about politics.

[Sam Grove]

History shows: when gov't revenue increases, congress increases spending even more.

History shows: despite variations in tax rates, gov't only manages to collect about 19% of GDP.

Increasing taxes will not solve the problem.

[DesigNate]

So you are for raising taxes on the middle class working man then?

[DesigNate]

So you are for raising taxes on the middle class working man then?

[John Thacker]

But you're opposed to letting the Bush tax cuts expire during a downturn, right, for the same noble reason that you're opposed to even discussing any spending reductions right now? After all, the science (from Administration officials like Christina Romer and others) demonstrates that tax cuts do have a multiplier, and generally higher than that of spending.

After all, that's why the Democrats ended up voting to extend the tax cuts.

[Tony]

But you're opposed to letting the Bush tax cuts expire during a downturn, right, for the same noble reason that you're opposed to even discussing any spending reductions right now? After all, the science (from Administration officials like Christina Romer and others) demonstrates that tax cuts do have a multiplier, and generally higher than that of spending.

I'm not sure what "science" your referring to. According to Moody's (which Romer et al get their information from), the biggest multiplier comes from food stamps (1.73). Spending generally has a higher multiplier than tax cuts, but among tax cuts, Moody's estimates the following:

A payroll tax holiday has a multiplier of 1.29. The tax cuts in the 2008 stimulus (refundable lump-sum rebates) have a multiplier of 1.26. Keeping the Bush tax cuts have a multiplier of 0.23, the lowest of any proposal on the table.

[sarcasmic]

Wanting to raise taxes on the wealth simply because they are wealthy and wanting to repeal the Bush tax cuts simply because they came from Bush does not make one an ideologue?

It's not about politics, it's about basic economics and common sense.

Removing money from the economy through taxation does not stimulate the economy.
It has the opposite effect.

Raising taxes will hurt the economy. Period.

[Tony]

Removing money from the economy through taxation does not stimulate the economy.
It has the opposite effect.

Taking money in taxes is not necessarily removing it from the economy. If you tax money that's sitting in someone's mattress and then spend it on infrastructure or something, you're actually introducing it to the economy.

[Matrix]

that's not how it works. We don't tax people on money they already have, but we tax them on income, which is extortion (pay us, or bad things will happen to you). Forget it. You're not entitled to anyone's money, Tony.

[Tony]

we tax them on income, which is extortion (pay us, or bad things will happen to you). Forget it. You're not entitled to anyone's money, Tony.

If you want to believe that, fine. Just don't say you're interested in discussing real solutions for the budget.

[sarcasmic]

If you tax money that's sitting in someone's mattress and then spend it on infrastructure or something, you're actually introducing it to the economy.

Who keeps money in a mattress?
Besides that is wealth, not income.
Income is taxed, not wealth.
But let's say that that income you want to tax was going to be put into savings and not spent immediately.
That bank can not loan that money now because you took it away. So that business that needs a loan to make payroll can't get it, and now it's employees are looking for work.

Good job Tony.

[Tony]

That bank can not loan that money now because you took it away. So that business that needs a loan to make payroll can't get it, and now it's employees are looking for work.

I'm not sure that scenario results in less economic activity than just letting the government direct it to something useful.

[sarcasmic]

I'm not sure that scenario results in less economic activity than just letting the government direct it to something useful.

Spoken like a true socialist.

[Matrix]

like cowboy poetry? Go peddle your snake oil elsewhere

[John Thacker]

When you say "the Bush tax cuts expire," do you mean the tax cuts on the middle class and poor as well? If not, then you're talking about a still fairly small amount of money.

But I might be willing to let the tax cuts expire if we also rolled back spending to that of those dark days of 2001.

[Tara]

Abso-fucking-lutlely. I would stand up an applaud a tax deal that rolls back EVERYTHING Bush & Obama have ever done. I'll gladly give up Bush's minuscule tax cut if it also means rolling back ObamaCare, Medicare Part D, No Child, DHS, military adventurism & nation-building, and every other hair-brained scheme including canceling any remaining "stimulus" spending we have in the pipeline. Let's roll it all back to 1998.

Any takers for that deal among the left?

[DesigNate]

Well I'm not on the left, but that sounds good to me.

[joshua corning]

You fucking know what I'm talking about.

Yes we know what you are talking about. But left wing language used to describe it is not only a lie intended to deceive the public but it gets on our nerves. We will correct it every time.

[Tony]

joshua you people make a game out of this every chance you get.

"Tax cuts don't affect the budget because... uh... look over there!

Anyway, what I was saying is it's THEIR money so it's not right to take it!"

[Scruffy Nerd Herder]

I think I speak for a lot of people when I say that given the massive increases in federal, state, and municipal spending over the last decade, we will not under any circumstance consider a tax increase until the budgets have been slashed significantly (say 25% or more). It's simply not open to negotiation anymore, primarily because we don't believe the gov't will willingly cut anything of significance otherwise.

[Tony]

And who might you be?

The fact is the American people want more government than they want to pay for. Except this isn't really true, since they're just fine with raising rates on the rich and corporations as well as closing loopholes that will increase revenue.

Either you care about balancing the budget, or you care about using debt as an excuse to pass a political agenda. It's obvious where the Republicans stand, and libertarians are parroting them exactly.

[Sam Grove]

Americans grew up in Disneyland with their parents paying the bill.

Taxing wealth that has yet to be created from the wealthy ensures that said wealth will not be created.

You don't think deep enough about economics.

[DesigNate]

What is so fucking hard to understand that we can and should cut the government down to 2005 levels. People were not dying in the streets, children were doing just a poorly in school, and old people were being taken care of.

[sarcasmic]

2005?

How's about 1905?

[Scruffy Nerd Herder]

I definitely care about balancing the budget. In fact, I care so much that the burgeoning debt of this country is making me actually consider leaving it, even though I have significant investments of capital and emotional worth.

We are spending more than we can afford, period. Attempts to raise the tax rates to cover the massive deficit, which is primarily caused by entitlements and military adventurism, will only drive the wealth out of the country or into hiding. It's a global economy now and capital is mobile.

As far as who I am, I'm a citizen, a taxpayer, a property owner, a business owner, and a familyman, who believes that the debt that the gov't is placing on the heads of his children is too much, and that their opportunities and quality of life will suffer for it.

[fullmetaltrousers]

Here-fucking-here, my man.

[LibertyMark]

This logic amazes me for its stupidity, even coming from Tony.

He says people aren't willing to pay for all the government they want. That's true! I agree with Tony!

But then he says that no, they actually ARE willing to pay for it because they are willing to use other peoples' money to do it.

My mind boggles.

[.]

They only think it's other people's money. They don't seem to realize that all business taxes get passed on to the consumer in the form of higher prices. The end-users pay all the taxes.

[LibertyMark]

Yes, good point, all taxes end up being paid by individuals. Liberals are just utterly brain-dead when it comes to their "tax the evil corporations!" bullshit.

But as far as the income tax is concerned, many people are more than happy to take money from the "rich" to pay for their own goodies.

To Tony that makes them willing to pay for government.

[sarcasmic]

They only think it's other people's money. They don't seem to realize that all business taxes get passed on to the consumer in the form of higher prices. The end-users pay all the taxes.

Yep. Just like they think tariffs on foreign goods are taxes on foreigners, when they are actually taxes on the citizens who buy them.

Higher business/corporate taxes and higher tariffs mean higher priced goods for the consumer, which means less money to be spent on something else, which means a slower economy.

[Tony]

I thought prices were the result of supply and demand.

[sarcasmic]

I thought prices were the result of supply and demand.

Taxing producers (businesses, corporations, evil rich people who invest in said businesses and corporations) lowers supply (and the jobs used to create that supply) which increases the price.
Increased prices to not help the poor.
I thought you wanted to help the poor, Tony?
Why do you want to increase prices for goods and reduce job opportunities?
That doesn't help the poor.

Seems to me that you don't want to help the poor at all. You just want to tear down the rich.

[Tony]

I want to see numbers, not assertions.

Numbers that show that increasing the tax rates on the income of business owners significantly affects prices of the goods they sell.

Then you can get around to showing how increasing income tax rates on hedge fund managers affects the poor.

[sarcasmic]

I want to see numbers, not assertions.

I mistook you for someone who has a functioning mind and is capable of actual thought.
For a moment there I expected you to engage the reasoning capabilities if your brain, the part that separates you from animals.
My deepest apologies Tony.
I really am sorry.

[Clouds]

No shit tony, raise taxes on biz and they will have less money to produce supply. thereby increasing prices.

[joshua corning]

I thought prices were the result of supply and demand.

Taxes effect the supply. Ever heard the term supply side economics? If producers costs go up because of the taxes then producers will leave the market....less producer means less product which means lower supply which means higher prices.

[Tony]

Ever heard the term supply side economics?

Isn't that the thing that it took 30 years of increasing misery to prove to be a crock of plutocratic shit?

[Matrix]

And you know what, I want to win the lottery too, but I don't want to pay to play. But in your world, I should be able to get it just because I want it regardless of the fact that I will not contribute.

[sarcasmic]

Clinton balanced the budget by borrowing from Social Security instead of the general public.

It would be like you replacing every dollar in your 401K with IOUs and claiming to have balanced your household budget.

[R C Dean]

Wnat Paul says all seems like the most obvious common sense to me. I wish I could figure out how to hammer through the thick skulls of voters and politicians, but I suspect that won't happen until the bond vigilantes administer some education-by-concussion.

[Mike Laursen]

Michael Moore says there are no fiscal problems at all, other than the continues existence of "the rich".

[DesigNate]

That fat fuck better be the first in line to donate all of his shit to the state then.

[sarcasmic]

It's the people who have attained wealth by creating value that Moore is talking about.

That leaves him out.

[P Brooks]

Of course there is an answer. Raise taxes.

What could possibly go wrong?

[Matrix]

Yeah, I mean, it's not like they'd ever go ahead and increase spending at the same time or anything.

[P Brooks]

Most of the problem is lower revenue, due to the economic downturn and reckless tax cutting.

Speaking of ad nauseum...

[Joseph Goebbels]

If you repeat a lie often enough, it becomes the truth.

[Tony]

Much like the lie that raising taxes doesn't increase revenue. Or that cutting taxes on millionaires will create jobs. Or that raising taxes on millionaires will destroy jobs. Bullshit all around.

[Darth Vader]

The class envy is strong with this one.

[DesigNate]

Except you know, the fact that the top 50% pay 96% of all income taxes. Don't be disingenuous Tony, you're one of the few left leaning people I like having around here.

[Tony]

Thank you. But the top 50% don't pay most of the taxes because they are overburdened by taxes, but because they have almost all of the wealth and make almost all of the income.

[DesigNate]

So you think someone making 75k a year is a complete asshole for wanting to keep more of his money?

[Tony]

I'm fine with keeping rates in place for people under $250,000.

Rescinding all of the Bush tax cuts would do much more for the deficit, but I'm not hysterical about the deficit, for which I feel the best solution is a robustly growing economy.

[Pedant]

To close the deficit, revenues would need to increase by 76%.

If we exclude raising social security/medicare taxes (leaving mostly corporate and individual income taxes), revenues on the remaining portion would need to increase by 127%.

If we exclude raising income taxes to those in the bottom 90% of income earners (those making less than $100k), revenues on the remaining portion would need to increase by 160%.

If instead we exclude raising income taxes on those in the bottom 99% of income earners (those making less than $400k), revenues on the remaining portion would need to increase by 224%.

Good luck with that.

[Fiscal Meth]

At what rate would the rich have had to be taxed over the last two years to make up the 8 trillion dollar deficit which was racked up?

[Matrix]

100% for the next decade, probably. That might bring it down quite a bit, but we'd still be broke. And yet, I'm sure politicians would find a way not to pay down the debt, but instead radically increase spending. Then they'd find out that those rich people would give Uncle Sugar a big middle finger and take their hard earned money elsewhere.

Oh wait, I better not offend Tony and other leftists by calling it "hard earned money"... uh, I believe the PC term is "money generated on the backs of exploited hard working employees." There... is that right?

[Tulpa]

The problem, Tony, is that it's not mostly lower revenue that's the problem. If we had kept spending at 2001 levels we wouldn't even have a deficit now.

[Matrix]

Well, it would not be feasble to keep spending at the same levels if inflation was taking over. But, spending should increase at the same rate of inflation, which is typically what... 3% per year? so we should be about 30% above what we were in 2001, not the monster we have today.

[Almanian]

Heard Paul's 10 min speech on the radio this AM on the way to work

Fucking. Awesome.

He impresses me more every day. I'd considered moving to KY - he makes me want to do so even more. Trade that dunce Stabenow and the useless Carl Levin as my Senators for Rand Paul and [anyone else]? Good trade...

[Tulpa]

Yeah, but he's packaged with Mitch McConnell.

[robc]

Its still a win.

[P Brooks]

Much like the lie that raising taxes doesn't increase revenue.

Okay, Butch; let's say you hide behind a tree, and leap out and steal my lunch money as I'm walking to school.

Let's then say this ploy is so successful you start doing it on a regular basis; you soon come to believe *my* lunch money is in some way actually *your* lunch money, and I just carry it around for you until you "need" it. Do you honestly think I won't start taking a different route?

I could even offer to pay HALF of my lunch money to somebody who can keep you from getting your mitts on ALL of it.

Do you see how this works?

[Tulpa]

Oh please. Allowing marginal rates to return to normal levels after the temporary by design tax cuts for earnings past $250K is not "stealing lunch money" by any stretch of the imagination. Take your hyperbole somewhere else.

[robc]

Umm...which part of the income tax isnt equivalent to "stealing lunch money"?

[Lost_In_Translation]

Why are tax cuts temporary by design yet tax increases aren't?

[P Brooks]

Gifts to the United States
U.S. Department of the Treasury
Credit Accounting Branch
3700 East-West Highway, Room 622D
Hyattsville, MD 20782

[Matrix]

Send that fat bastard Michael Moore this address, along with all the "do-gooders" AKA thieves that parrot the leftist mantra of taxing people heftily to give to the "less fortunate" AKA people who don't want to earn their own living.

[R C Dean]

I posted above that the line that the deficit is caused by the downturn and "tax cuts" is an obvious lie.

I got the predictable response; that I wasn't counting all the Obama tax cuts, including the maintenance of the status quo rates and deductions.

Without those, the deficit would be in the $1,250BB range. I thought I saw that the Obama extension of the 2010 rates and deductions were going to reduce receipts $200-300BB in 2011. Let's take the middle estimate, and we get a nice round remaining deficit of $1,000BB.

[Tara]

Shared this article on Facebook with the following headline:

"I don't know what kind of weed was loaded into the Aqua Buddha, but I really wish the other 99 Senators would take a hit off it."

[Paul]

I have to ask, is it pronounced Tahra like in 'tarred and feathered', or Teara, like in 'tare or tear'?

[GSL]

I don't like everything about Rand Paul, but this is awesome. It's a (very) little comforting to know that at least someone in DC grasps that the "austerity" being discussed by both parties is pissing in the wind. Congress can either deal with this problem head-on, or wait for reality to give it a serious beatdown.

[P Brooks]

ps-

Way to completely miss the fucking point, Professor Huffandpuff.

Any new "revenue enhancements" will suffer from diminishing returns, because taxpayers respond to incentives, and find ways to re-classify their earnings or otherwise reduce their taxable incomes.

Sheesh. Do we have to lead you around by the hand?

[Paul]

Meanwhile, we've got jackasses talking about the need to preserve tax-funded cowboy poetry slams and other tiny trims that have been too long in coming.

But if we drop funding for cowboy poetry, Baxter Black will have to rely on his large animal vet income alone!!!11!!

[P Brooks]

Rescinding all of the Bush tax cuts would do much more for the deficit

HAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHA

[robc]

The only one that might might be the 10% tax bracket.

Raising it back to 15% actually might slightly raise revenue.

[Matrix]

It would be funny if it was not so depressing.

[Tony]

What are you laughing at? I was saying letting all of them expire would do more than just letting the cuts expire for incomes above $250,000, which is true.

[Draco]

Removing money from the economy through taxation does not stimulate the economy. It has the opposite effect.

Raising taxes will hurt the economy. Period.

This is what kills me about you guys. When I'm here, explaining how deficit spending injects net financial assets into the private sector, and how that is especially necessary during times of high unemployment, you tell me I'm an evil utilitarian.

But when I'm not here, you post things like this.

You see, you can't have it both ways. If cutting taxes helps the economy, then so does increased government spending. Both increase the deficit. Therefore, both transfer net financial assets to the private sector. Both increase aggregate demand (Spend $1M on road work and $1M goes to the contractor and his employees and suppliers, who then presumably spend it or save it. Same with a tax cut.)

One advantage of the neo-Keynesian perspective I've been advocating is that at least those who hold it can be honest, unlike Democrats on one side (Tony) and Republicans and Libertarians on the other.

Dems: "You can't cut government spending, it will throw people out of work and hurt economic growth."

Reps/Libs: "You must cut taxes, so that economic growth can occur."

Confused moderate: "But aren't you both saying that the deficit is bad? And aren't you both promising to increase the deficit via your proposals? Either I'm confused, or you are all hypocrites."

Now, let me be clear: tax cuts are usually the better option, because individuals know best how to spend their money. But there's a certain amount of responsibility the government has for basic infrastructure, and the roads and bridges are crumbling all around us. So, in a time of high unemployment, the sane course is to keep cutting taxes and increasing expenditures on basic infrastructure, to restore aggregate demand.

[robc]

We arent all the same person.

Im the one that called you an evil utilitarian, and I didnt post that.

If cutting taxes helps the economy, then so does increased government spending.

Bullshit. Did you read any of the fucking Barro studies since yesterday?

Tax cuts have a multiplier greater than 1. Government spending doesnt.

[robc]

But there's a certain amount of responsibility the government has for basic infrastructure, and the roads and bridges are crumbling all around us.

What level of government? Some of us are more federalist than others and see this as a very important distinction to make.

[Draco]

Only the federal government can boost aggregate demand in the way I'm proposing since only the federal government issues fiat currency. So, if the states are responsible for roads and bridges (as they usually are), the federal government would need to grant them the money.

[robc]

You see, you can't have it both ways. If cutting taxes helps the economy, then so does increased government spending.

Bullshit again. First order, you are correct, but 2nd order effects matter. And the second order matters a lot.

[robc]

deficit spending injects net financial assets into the private sector

This is even more bullshit. Is anything you said even remotely true?

1st order, it balances. The $ of spending is exactly balance by the $ of borrowing, so the net to the private sector is zero.

2nd order, its worse than that, as the multiplier is way less than 1.

[Draco]

No offense, but if you truly understood this perspective, you'd realize that the worse the multiplier, the more effective for the purposes of restoring aggregate demand. So, you are strengthening the argument by point out multiplier < 1.

[sr7]

No offense, but you are implying similarity or sameness upon factors that are not homogeneous.
The purpose of the multiplier in the Keynesian scheme of things is to solve for the problem of opportunity cost. If it is not higher than 1.0 than it does not do so, and the resources that are misallocated for public policy are then less productive in the long run (solving for opportunity) than if they were either not in current use, or in a minimal allocation. Gasp! Savings, of which Keynes theory treats like a useless appendage, a fact alone that makes it useless in describing real world phenomenon. It is no more than a get rich scheme done on the macro scale.

[sr7]

It is no more than a get rich quick scheme done on the macro scale.

[sr7]

So, in a time of high unemployment, the sane course is to keep cutting taxes and increasing expenditures on basic infrastructure, to restore aggregate demand.

In flush times, financing infrastructure is not that big of a deal, so your solution is really a no go.

Plus, PIMPCO is on line two, and they would like to have a word with you. You sold them a bad bill of goods, hon.

Raw spending can't replace a functioning capital structure, no matter how you prep that recipe.

Keynesians are so far off the mark, it is no longer even funny. Pity about the recent revival though, a generation ago, when I was in college, even my statist professors gave up on Keynesian fiscal policy, and pretty much retreated to a monetary policy of the Monetarist school position. It will blow over soon enough though, as the tragic effects of the Keynesian based policies of the last two years are accounted for in the annuals of history.

[Tony]

After the events of 2008 and 2009 Keynesianism is pretty much the only thing left standing.

But that is the beauty of its main competitor: no evidence required.

[sr7]

You got an American classic on your reading list you haven't gotten to yet? Red Badge of Courage, maybe? You should get to it, because you are terrible at this.

[sr7]

So it doesn't confuse your post classical sensibilities Raw spending can't replace a functioning capital structure servicing actual (instead of government guess work) consumer demand, no matter how you prep that recipe.

[Mensan]

If cutting taxes helps the economy, then so does increased government spending. Both increase the deficit.

def?i?cit noun \?de-f?-s?t\: an excess of expenditure over revenue

Reducing revenue does not increase the deficit. It only determines the point at which spending becomes excessive. The only way to create or increase a deficit is by spending too much.

[GroundTruth]

How bout Paul and Paul in 2012? Ron as Prez, and Rand as VP? Then when Ron's head explodes from trying to deal with the idiots in congress, we've got a few more years of sanity left!

[Mensan]

Good news, everybody!

I just got a letter from the VA explaining how the Post-9/11 Veterans Educational Assistance Act of 2010 that President Obama signed on January 4, 2011 will reduce my G.I. Bill benefits.

It seems that they are actually cutting some spending. It sucks for me personally that it's a program that I actually use, but, hey, a spending cut is a spending cut.

Although, now that I think about it, I wouldn't be surprised if congress managed to increase the actual amount they are spending on the program while simultaneously reducing veterans' benefits.