Originally Posted By DouglasDubh <Why let this bunch off the hook for the financial mess they're making longterm?> Last time this came up, I asked if you had read anything about the guy Shadegg who is running for House Majority Leader. Have you yet? I will almost always vote for the guy who calls for less government spending. I simply don't hear that call coming from Democrats, and Libertarians take the idea too far. That pretty much leaves me with the Republicans.
Originally Posted By Kar2oonMan >>Last time this came up, I asked if you had read anything about the guy Shadegg who is running for House Majority Leader. Have you yet?<< I must have missed that the first time around. In reading a little bit about him, he looks like a much better choice for House Majority Leader than the names I've been hearing brought up most often in the press. Looks like he's a fiscal conservative and scandal-free. Thanks for the heads up about him, I'm reading more about him.
Originally Posted By patrickegan Taxes on payroll are still being paid. You can only draw so much SS and you are at the top of the scale. Statistically the rich pay the majority of the taxes unless like the Kennedy’s they have some kick-butt shyster attorneys and accountants. (My apologies to accounts everywhere for lumping you in with attorneys) What are they going to do give people who make $10 mill a year $6000/ month checks when they retire? It’s a given that these folks have read the frugal sailor’s guide to financial security and won’t only rely upon SS when they retire. Why do you guys think I should support other people at the expense of my family? I’d love to send the boy to a private Catholic school and maybe cut the work schedule down to 6 days a week.
Originally Posted By Darkbeer Want an Unbiased source, how about the CBO... <a href="http://www.nationalreview.com/nrof_luskin/luskin200601270946.asp" target="_blank">http://www.nationalreview.com/ nrof_luskin/luskin200601270946.asp</a> >>On Thursday the Congressional Budget Office released its annual Budget and Economic Outlook, and buried in one of its nearly impenetrable tables of numbers is a remarkable story that has gone entirely unreported by the mainstream media: The 2003 tax cut on capital gains has entirely paid for itself. More than paid for itself. Way more. To appreciate this story, we have to go back in time to January 2003, before the tax cut was enacted. Table 3-5 on page 60 in CBO’s Budget and Economic Outlook published in 2003 estimated that capital-gains tax liabilities would be $60 billion in 2004 and $65 billion in 2005, for a two-year total of $125 billion. Now let’s move forward a year, to January 2004, after the capital-gains tax cut had been enacted. Table 4-4 on page 82 in CBO’s Budget and Economic Outlook of that year shows that the estimates for capital-gains tax liabilities had been lowered to $46 billion in 2004 and $52 billion in 2005, for a two-year total of $98 billion. Compare the original $125 billion total to the new $98 billion total, and we can infer that CBO was forecasting that the tax cut would cost the government $27 billion in revenues. Those are the estimates. Now let’s see how things really turned out. Take a look at Table 4-4 on page 92 of the Budget and Economic Outlook released this week. You’ll see that actual liabilities from capital-gains taxes were $71 billion in 2004, and $80 billion in 2005, for a two-year total of $151 billion. So let’s do the math one more time: Subtract the originally estimated two-year liability of $125 billion from the actual liability of $151 billion, and you get a $26 billion upside surprise for the government. Yes, instead of costing the government $27 billion in revenues, the tax cuts actually earned the government $26 billion extra. CBO’s estimate of the “cost†of the tax cut was virtually 180 degrees wrong. The Laffer curve lives!<<
Originally Posted By cmpaley That's not a CBO report, that's a National Review Op/Ed piece (all articles in the NR are Op/Ed pieces as the NR is an opinion magazine, not a news magazine). Op/Ed pieces from ANY side of the spectrum hold little credibility with me.
Originally Posted By patrickegan <<the tax cuts actually earned the government $26 billion extra.>> Looks like the tax cut worked!
Originally Posted By DouglasDubh <That's not a CBO report, that's a National Review Op/Ed piece> Yes, it is. But you can go to the CBO reports and verify that the information is correct.
Originally Posted By Darkbeer FYI, the National Review article has links to the CBO reports in its article, just click the link above....
Originally Posted By Dabob2 But this is a very misleading way to look at it. Capital Gains receipts go up in years where there are more capital gains; for instance, when the stock market goes up. We all know the market has done considerably better the last couple of years than it did in the couple of years following 9/11. (Which looks like the years being compared). So it's disingenuous to say "we put in a capital gains tax cut, and we got MORE money in capital gains, and that's the reason." Well, no - that does not necessarily follow. The better comparison would be: how much money in capital gains tax would we have reaped in the last couple of years if there had not been a cut? Assuming capital gains receipts were the same, obviously we would have reaped more if the rate had not been cut. Of course, to a supply-sider, the cut in the rate is the reason for more c.g. receipts, because there would have been more investment, etc. But that does not necessarily follow, and can not be shown in this case. There are many reasons the market goes up, and in any case, it would have been hard to do worse than the period after 9/11.
Originally Posted By DouglasDubh That's ignoring the fact that when taxes are raised, the additional revenue is almost never as much as projected, and when taxes are cut, the decrease in revenue is almost never as much as projected.
Originally Posted By Kennesaw Tom How can you cut taxes on people who are not paying taxes anyway? 50% of Americans are not paying any form of income tax as it is.
Originally Posted By cape cod joe Good to see that rational thinking KT! It's really pretty simple but...
Originally Posted By StillThePassHolder So when is the deficit going to start falling? <a href="http://www.cnn.com/2006/POLITICS/02/06/budget.ap/index.html" target="_blank">http://www.cnn.com/2006/POLITI CS/02/06/budget.ap/index.html</a>
Originally Posted By cape cod joe Pass when I saw this first thing today, I winced! We CAN'T afford to cover the whole planet. We have to pick our fights more carefully.
Originally Posted By TomSawyer >>How can you cut taxes on people who are not paying taxes anyway? 50% of Americans are not paying any form of income tax as it is.<< This is one of the reasons that I think things like estates and capital gains should be taxed as income, at the regular income rate. I don't think it's right that earned income should be taxed at a higher rate than windfalls.
Originally Posted By cmpaley >>So when is the deficit going to start falling?<< Probably in 2009 when we get a new President...assuming the current one doesn't crown himself Perpetual Dictator and Emperor for Life.
Originally Posted By Dabob2 <That's ignoring the fact that when taxes are raised, the additional revenue is almost never as much as projected, and when taxes are cut, the decrease in revenue is almost never as much as projected.> It's not ignoring it; that's a separate topic. First of all, your assertion is not really borne out by history; we went through this before and interpreted the CBO numbers differently - no big surprise. But that's not what my post was addressing. I was addressing the logical fallacy, a classic example of "post hoc ergo proctor hoc" - aka "after the fact, therefore because of the fact - when a temporal relation between two events is assumed to prove that the first one caused the second one."... i.e. "because we cut the c.g. rates, that's why we have more c.g. revenues." That's a logical fallacy that doesn't follow.
Originally Posted By TomSawyer We didn't have terrorist attacks on American soil until we started reducing our capital gains rates.
Originally Posted By DouglasDubh <So when is the deficit going to start falling?> It already has. As a percentage of GDP, it's relatively small. If we want to go from a deficit to a surplus anytime soon, however, we need to reform entitlements.
Originally Posted By DouglasDubh <This is one of the reasons that I think things like estates and capital gains should be taxed as income, at the regular income rate. I don't think it's right that earned income should be taxed at a higher rate than windfalls.> The people who aren't paying income taxes aren't usually the people who are getting income from estates and capital gains. But the reason why earned income is taxed at a higher rate than capital gains is because earned income hasn't been devalued by inflation.
