Why blame Obama for tax cuts?

The whole thing is a poop sandwich to whichever ideology you support. Benjamin Franklin said once (and I’m paraphrasing) that you shouldn’t allow people to become comfortable in their poverty, in addition to tax cuts are typically good stimulus for the economy but allowing these unemployment benefits to be extended somewhat cancels that out a bit you’d think.

Meanwhile if you think that rich should just pay in, and if you do- I disagree with you with you, they are getting their money, so you’re eating poop with me…doesn’t it taste horrible?

I am not going to blame Obama for the tax cuts….no one should blame him as it appears he gave everybody not just one but 2 nice tax cuts and some people just got a new lease on life with the temporary extension of the 35% death tax rate. Now that he has made everybody happy, there is one small detail Mr. Obama has largely ignored is how are we gonna pay for it?? What’s another few hundred billion dollars on the deficit amongst friends!

I think it was a ballsy move, largely ignoring his democratic base, punting on 3rd down giving the Republicans what they wanted now everybody has to explain how this all will get paid back!! No one can complain either! Ha!

I don’t understand politics, so don’t yell at me.

I don’t understand, as well, why tax cuts for people who are making, honestly, millions every year makes sense. I’m pretty sure that isn’t necessary.

I’d really like to know the reasoning for at least the majority of Republicans for this cause.

@Fred931 – There are reasonable premises behind a general “trickle down” theory. I strongly agree with some aspects of it.

Basically, tax cuts for people who make enough money not to personally suffer from tax increases are made not necessarily because we don’t want to piss them off by taking their money…but at least partially because spreading the investment potential of these dollars across these individuals can be a better way of raising GDP generally. For every family in that bracket, for instance, suffering a $10,000 extra tax hit (really high number, but go with it), is a family that isn’t getting a car they planned to. Or they are tightening the budget on their business. They may even be laying people off. The people who have the money currently more than likely have a better idea of how it can be efficiently used in the market as opposed to the government which, I think we all can agree, isn’t the best with money.

Because owing a lot of money is a dangerous thing. The debt will likely only get bigger and bigger, and it is scary. First the American people living on credit and that bubble burst, bad debt all over the fucking place, and now our government. Back in the day of Reagan the Republicans walked around saying debt is fine. I think they are the same as salesmen…having a mortgage is fine, hell better, because you have use of your money. I don’t trust the Republicans are upset about the debt, I just think they hate the Democrats and Obama and taxes.

I think Obama should just suddenly switch to and support every Republican position on every issue… Because they, in their blind hatred of all things Obama and “liberal” will immediately switch to the exact opposite and call what he supports communist and evil and yada yada. And as much as it pains me to say it, the Republicans have far larger balls than the Democrats.

Seriously, Obama could introduce legislation to call eating babies wrong, and the Republicans would probably say he’s trying to take away our freedom to eat what we want.

@tedd I had said something similar a while back, glad you reminded me of it. Reverse psychology.

I think that saving unemployment benefits right now was key. I think that the huge deficit that we have is the result of Bush’s pursuit of the needless war in Iraq.

In reality, there are no tax cuts for anyone. The real question was, would our current tax rates go up in January? Income taxes really don’t define wealth in the sense of terms like “the rich” thrown around by the MSM or politicians. Rich means having alot of wealth not alot of income.

Think about someone who has worked many, many years making an income much lower than $125,000 or a couple raising a family on an income much less than $250,000. After working and finally achieving a level of income of $250,000 and perhaps having a child in college costing $30,000 to $70,000 a year, I’d say they feel far from “rich.”

It is very deceptive to say “the rich” are people with incomes of $250,000 and we should allow the governmet to step in and take away what they have invested years to achieve. It is also deceptive to parallel giving money to the unemployed versus giving money to “the rich.”

When you cut taxes you aren’t giving people anything. You are allowing them to keep what is theirs in the first place. Allowing them to keep what they have earned. Extending unemployment benefits on the other is actually giving someone something. How long do you propose giving someone unemployment benefits and living off the tax payers? One year, two years, until someone finds a job making exactly what they were making before?

@bkcunningham you do realize the middle class paid less taxes in 2009 than 2008 right? I disagree with the $250k number also, a number invented in the early ‘90’s by congress, but adjusted for inflation is more like $370k now. But, I feel very confident that if the government told us Bush tax cuts will stay in place, but everyone was actually taxed a little more very few people would even notice. They seem not to notice they paid less last year. I don’t think most people look at a tax table, or can even do tax math.

I think you miss the point JLeslie. Also, I don’t think that assuming people are stupid is a very good argument.

The Ben Franklin quote is: I am for doing good to the poor, but I differ in opinion of the means. I think the best way of doing good to the poor, is not making them easy in poverty, but leading or driving them out of it.

The republicans held millions of Americans hostage so that they could protect the rich and privileged from something they wound do them no harm. In that action they showed that the Republicans have absolutely no moral right to rule and are more concerned with power and are ultimately anti-American.

I hate that Obama has submitted to blackmail and even more distressed by the democrats that support this position. We really need a clean sweep next election.

@bkcunningham who said stupid?

@bkcunningham – there are a couple of tax cuts that are new, but I think it’s right to claim that these are tax cuts. They are merely extensions of current tax policies for two more years.

But I would be careful in claiming that characterizing something as deceptive unless you’re going to describe the situation without spin yourself. It’s very deceptive, for instance, to claim that taxes are taking something earned, when taxes are used to pay for the government generally. I am not arguing that they’re efficient with it, by any means. But, we do need to qualify it as payment for sundries, in essence – the roads, the police, the army, attorney retainers for those prosecuting for the state and defending citizens, etc. It’s nice to have rights, but there is a dollar value associated with administering them.

It’s also deceptive to say that unemployment benefits are paid to people for doing “nothing.” First, they benefit all society in that they prevent people from becoming indigent, which often leads to crime. Second, unemployment is not welfare – these people did work, and did pay taxes, for a significant period of time to qualify for these benefits. And considering the state of the current economy, we’re not talking about a huge group of people gaming the system by necessity now. These are people who paid into a system, just in case, so that they’d have a cushion when things went bad. And now, they’re getting their taxes, essentially, paid back to them. And trust me, it’s not until they get what they got before – “qualified” employment means a lot less than that.

It’s very unfair, also, to say that unemployment is making them “easy in poverty.” Again, we’re talking about working people here by necessity.

@bkcunningham and I am concerned about the debt in my statement, not the poor.

Taxes are absolutely taking something earned. There is no way to spin that fact. No one is talking about “gaming the system” as you say. I’m talking about facts of indefinite unemployment. How long do you suppose these tax dollars are paid to the unemployed? Employees don’t pay into a fund to pay unemployment benefits when they are unemployed. (The Franklin quote was in response to a previous paraphrase of the quote.)

@bkcunningham I see. Well those unemployed people were paying in while they were working. I am not for extending unemployment forever, but I don’t want to see bread lines either. I would like more training offered during unemployment so we can fill jobs that are available.

Back to my point. Have you looked at the tax tables lately? Do you know what tax percentage you paid last year? Do you know the top 400 earners in the US pay an average of 17% tax as reported by the IRS. I just want the rich to pay as much as the average guy, but he republicans seem to dwell on the dollar amount the rich pay rather than the percentage. Those top earners I mentioned make over $200 million a year each by the way. I am not trying to put you on the spot. I had not looked at a tax table in several years until a month ago when I heard Republicans around me saying thy are already paying more taxes, and Dems on TV saying Obama had cut some. So I looked it up myself. I checked a few middle class incomes on the tables comparing 2008 to 2009 and it seems the dems were telling the truth and it is completely unnoticed.

Unemployment is also taxable income, ironically. And regardless of the extensions, we have hundreds of thousands for the year less than last year.

And indeed – employers pay into unemployment. And their rates are based on retention, so if they fire people, those rates go up (degree varying, of course). But employees pay into the government generally, so it’s not as if they haven’t contributed to the system now supporting them. For the most part, these are people with various skills level that want to get back into the workforce and whom we want to keep ready to do so. Losing productive labor is as much a cost as anything else.

The thing is, we can’t really look at unemployment insurance as an unnecessary cost right now until the economy gets back to a point where jobs are being added to the market. When there is an obvious market connection to the current conditions, providing support to those affected by the market conditions has both a very practical purpose and a recognizable temporary quality.

Employees don’t pay an unemployment tax. Most employers pay both Federal and a state unemployment tax. I actually do know the tax table all too well. I know exactly what income tax I pay to federal, state and local governements. To be honest, I don’t know how many other taxes I pay that don’t fall under the “income” tax. For instance, gas, utility, air tax for television, food, clothing, etc.

I think a flat tax is a good option as well. You are preaching to the choir on that one. So what if someone who earns $200 million can find all sorts of legal ways to hold onto their own money? It is the way the tax code is written. If that is what you are discussing, that is another subject. Do you realize 47 percent of Americans pay no federal income tax? Credits for low- and middle-income families have grown so much that a family of four making as much as $50,000 owe no federal income tax. Households making an average of $366,400 in paid about 73 percent of the income taxes collected by the federal government. Pretty messed up tax code.

Anyway, you have to understand that there really wasn’t an agrument of tax cuts. It was an argument of whether the current tax rate would increase in January.

How long should unemployment benefits last?

I believe now it is all just a shell game…. The economy is not as bad as the soap opera spins it, because the economy is not real. Everyone panicked when Greece, Spain, Ireland, Portugal all where about to go belly up. What happened? Nothing! Europe put some words and numbers down on paper and everything is fine.

Everyone will tell you that China’s money is not real. But it is still accepted and borrowed from and paid back to. How?

To be true to the people who spoke loud and clear during the elections, but are amazingly silent about the debt that is being incurred. We should allow ALL the tax cuts to revert back to the Clinton era. How much would that save us and how quickly would we be able to pay the deficit back? That would certainly pay for the small amount needed to extend unemployment and then some.

@bkcunningham FYI to address me specifically type @ and the beginning of the user name and a list will pop up for you to choose from. I probably am at the end of giving unemployment extensions. I am not knowledgable on the subject, but from what I understand there have already been extensions, I am growing tired of it also, but again I have not looked into it enough to feel strongly about any opinion I might have.

Yes, I am for a flat income tax. My one hold out on it, is I think the tricky tax code gets people to do stuff they might not otherwise, kind of back to the stupidity point, but I don’t think it is really stupid, but more like a sales job. Buy a house and get a tax write off on your mortgage, stuff like that seems to work on a lot of people. But, fundamentally I prefer a more straight forward income tax. I would still give uder $50k almost no tax burden though, mine might be a little lower, maybe under $35k? But everyone should have to pay something in; even if it is $5, in my tax plan.

Thanks for the user name info @JLeslie. I wondered how that worked. I think the negative income tax should be given consideration. Nothing is perfect. But it would seem a more equitable taxing system while appeasing those who want the government to look after the “poor.”

@bkcunningham, you think people “earn” estates they inherit, or the interest on their trust funds?

You think Mark Zuckerberg “earned” every single one of his billions of dollars?

In what universe is “taking advantage of a windfall” equivalent to “earning” something?

@bkcunningham

Credits for low- and middle-income families have grown so much that a family of four making as much as $50,000 owe no federal income tax.

I’m really concerned about this statement – I just want to throw out that if you break that down per person, each person is budgeted 12,500 a year for survival. I…don’t think that they really should be paying any tax.

I also wonder whether the idea that that the tax isn’t distributed in an equitable manner comes from. In 2007, the top 5% of income earners paid over half of the federal income tax revenue. However, as of 2004, the top 5% hold 59.2% of wealth. The top 1% of income earners paid 25% of the total income tax revenue. Again however, the top 1% hold 23.5% of wealth. According to a conservative media group, it was “predicted” by an unnamed source that forty seven percent of Americans would pay no federal income tax in 2009 (though they still pay federal payroll taxes). This percentage does include some people without job income (e.g. children, retirees) along with the low-income workers to whom this applies, so the numbers get skewed, much like when we include a family of four making $50,000 without breaking down the per-person allocation.

So it seems that the population paying is small, but that population is paying taxes in a percentage equal to it’s share of the annual personal income.

It’s true that a $50,000 family of four pays no fed. income tax.

It’s bullshit that they pay “no tax.” They still pay taxes. This is such a dishonest talking point.

@iamthemob, I think it’s important to consider that money has a different value to rich people than to poor people.

$1,000 has a ton of value to someone making $30,000 a year. An extra $1000 might mean being able to go to the dentist this year, or being able to afford groceries for your kids.

$1,000 has almost zero value to a millionaire. An extra $1000 to a millionaire might mean another night out at a caviar bar. More likely it will just go into an interest-bearing account and not contribute to the economy at all.

The flat tax idea is premised on the notion that money has equal value to people. This is a pretty stupid notion.

NOTE: This not only applies to dollar amounts, but also to percentage of income. A poor person needs 80% of his income simply to survive. A millionaire needs 5%. Maybe 0%, if they live off interest.

@Qingu in using the term “earn” I was discussing whether the current tax rate should increase in January for people who earn an income. The inheritance tax is another discussion. We live in a family society in reality. The incentives that drive people are establishing a family. What is the affect of a 100 percent inheritance tax? People work hard and sacrifice for the benefit of their children.

They pay the tax and then get their money back @Qingu. It isn’t BS to say they don’t pay federal income taxes. It is when you look at the fact that they get the money paid back and in most cases, then some. We pay so many hidden taxes I couldn’t begin to say how much in taxes they pay. You are correct.

I am liking the @ thing.

Who was proposing a 100% inheritance tax?

And yes, it’s BS because they still pay payroll taxes. I am one of those poor working people who don’t pay federal income taxes. I got money back from the government last year. It didn’t cover what I paid in payroll taxes.

@bkcunningham Are you including capital gains in the earn column? Should that be taxed the same as all income?

And by the way, you said “Taxes are absolutely taking something earned. There is no way to spin that fact.”

It’s not “spin” to point out that rich people often don’t work hard, or at all, for their money, and many rich people certainly don’t work in proportion to the amount of money they are able to reap through windfalls.

Mark Zuckerberg is a hard worker, nobody is denying that. He does not work hard enough to earn billions and billions of dollars. He was lucky. So are most rich people.

This is why I don’t share your moral problem with taxes in general. I don’t believe that the market is this objective God-like entity that fairly and benevolently doles out “earnings” to people who work hard.

And looking back at some of the comments in opposition to unemployment insurance….

I agree that the government should not incentivize living in poverty. However, what in the hell do you expect unemployed people to do in this economy? There are no jobs; in many cases long-term unemployed are actively discriminated against. Unemployed people did not cause the recession that made them unemployed.

My uncle is a skilled worker who has been out of the job for 2 years. At the rate things are going, he may never work again. He has a family. If he doesn’t get unemployment, they will lose their home. And you seriously want to argue that paying him unemployment is worse than giving rich people tax cuts they don’t remotely need?

@Qingu – I agree – I think that the equal distribution at this point is equal almost to the point of being a regressive tax. We’re on the same page there. It’s difficult, however, to find the right balance.

@bkcunningham – You said “We live in a family society in reality. The incentives that drive people are establishing a family. What is the affect of a 100 percent inheritance tax? People work hard and sacrifice for the benefit of their children.”

Whether we live in a family society I think is a touchy issue right now. But, I’ve actually gone over to the side of minimal inheritance tax. There should be a wide berth of untaxed inheritance, and thereafter some major taxing (in the end, really…there’s only so much money it makes sense for someone to just get for being born)

I got into a huge fight with my father about the inheritance tax situation because I didn’t really see the problem with the taxation, as I didn’t earn any of it. I neglected the fact that (1) the money he saved to pass onto us was just that, money he wanted to pass onto us, and money on top of that (2) that had already been taxed. We have to remember that, practically, the estate was already taxed when the money is earned, and will continue to be taxed as it earns income.

I like Warren Buffet’s approach to inheritance.

He isn’t giving his kids a dime, because he thinks they should earn their own livings. Fancy that.

@Qingu – That’s great. That’s his choice. As it should be. ;-)

I also hope that he thought about providing for his grandkids, if he wants to. Cause, you know, if the parents mess up…he kind of screwed them right?

No. How would he be screwing them? And why should his grandkids deserve a bailout more than poor folks’ grandkids?

Ideally his immense wealth would be highly taxed to pay for social safety nets that would support his grandkids in case their parents screw up. Along with other grandkids with messed up parents.

In whatever regard they obtain the money legally, it is their money that is taken from them when they are taxed. You want to penalize someone who, by what ever luck or birth or invention, makes more money than someone else or doesn’t have to work hard by someone’s definition? What about the people they benefit by their industry or finances?

What is someone to do that is out of work? Find another job. Granted it may not be at the same level of pay that they were making before and they may have to cut back considerable on their expenses, they may have to use charities and other means of supplement for himself and his family.

Social welfare programs historically have created a tremendous mess in this country and around the world.

How long should the unemployment benefits last?

It isn’t a bailout to give something that belongs to me to whomever I select.

@Qingu – If that’s your honestly held belief, I hope that you’re not planning on giving anyone a gift ever again, for any occasion.

Considering that money spent on any gratuitous thing for anyone that you know simply because they are fortunate to know you is kind of insane objectively when you could use those funds to literally save people’s lives in the third world, doing otherwise negates a critique of the argument that relatives of the wealthy don’t deserve the benefit of that anymore than anyone else. I totally agree with that. However, it’s not my decision – it’s my family’s decision.

Ideally, that’s not at all what would happen. Ideally, the individuals would receive all of the money, tax free, and redistribute it in a manner that left them comfortable but also efficiently dealt with social issues that the government has proved rather inefficient in dealing with it.

@bkcunningham – no, again – that’s what we call a gift to someone you love. ;-)

How ludicrous an idea is it to assume that by someone giving someone a gift, someone else is going to starve.

@bkcunningham, just as people obtain money legally, they are taxed legally. That’s not a moral justification.

And it’s not about “penalizing” people who are lucky. It’s about taxing people fairly. As I said, 35% of income to a rich person has an incredibly different value than 35% of income to a poor person. And taxes pay for the civilization that makes industry and financial transactions possible.

“Find another job” — do you even realize how callous this sounds? Would you say this to my uncle’s face? He has been trying to find another job, desperately, for the sake of his kids, for two years. Again, you seem to have this immense religious-like faith in the market to supply employment to anyone who seeks it.

As for “social welfare programs creating a tremendous mess” around the world, okay, let’s flashback to before the 1930’s when people starved to death in the streets. Are you seriously suggesting that the world was a better place before social security and medicare, and similar programs in other countries? I don’t think you’d put your money where your mouth is.

And you’re being pedantic about “bailout.” If Warren Buffet’s kids are terrible parents, why should their kids deserve to be rescued by a wealthy patron more than my grandkids? Wouldn’t you rather live in a society where everyone’s kids can live with some basic guarantees like the ability to eat enough food and go to college if they work hard?

@bkcunningham – Not ludicrous at all. Pretty much factual. But you do realize that I’m agreeing with you on the estate tax front (I’m uncertain where the sarcasm or lack of it was directed to there).

But it is slightly difficult to agree with you when you make sweeping statements about social welfare programs. They’re pretty much a necessity of any conscientious society.

@iamthemob, I don’t like giving people gifts, actually. I would rather spend my money on the World Food Program.

But I’m not an idealist here. I’m not advocating communism. I think people should be able to give others gifts. I think wealth inequality is probably fundamental to human society, and that capitalism (and the ability to spoil your kids) works better than the alternative.

This doesn’t mean the system shouldn’t be regulated. It certainly doesn’t mean that it’s “immoral” to tax wealthy people, or that people have some kind of God-given moral right to spoil their kids without the government getting involved.

The money you spend on internet and a computer to type in this forum would be an insane amount of money to some people. Why don’t you contribute that to your uncle and his family? Or donate it to charity. I’m not picking on you directly @Qingu. I am making a point. What I do with my money is my choice. What you do with your money is your choice. You can’t dictate and legislate morals and responsiblities and live in a free society.

Of course I think it is horrible to see someone lose their job. My brother died unexpectedly a year ago the 13th of this month. His wife and daughter and grandchildren are having a very difficult time financially. They aren’t receiving any government assistance because that is their decision. Not that it is any of your business, but my husband and I are helping her and so are other members of my family and her family. That is one of the things that we choose to do with our money.

BTW, I don’t like taxes for anyone. I don’t believe in the class warfare redistribution of wealth rhetoric.

@Qingu – Indeed. It’s totally moral to tax rich people, as far as I’m concerned. My problem, practically, lies in the issue that estate taxes represent a double taxation of wealth. Income is taxed, income earned on income is taxed, and someone who saves responsibly to pass onto children is justified in feeling cheated when they are told that money they already paid taxes on will be taxed again when passed on.

@bkcunningham – I don’t see a workable system in an economy of this scale without taxation. Once we get to the side where it’s unclear how much we need to pay to build a road, etc., we can’t really determine ourselves what we should be contributing. It was possible, but now I can’t conceive of a manageable system of voluntary contribution when your population is strikingly anonymous. I would like to believe in a world without it – but I’m not confident enough in humanity to make it work.

@bkcunningham, there is no such thing as a completely free society. You can’t, for example, spend your money on enriched uranium or donate it to al-Qaeda.

You also have far less choice about what to do with your money than, for example, Warren Buffet. I am assuming you are not mega-rich and that you must spend a large proportion of your income on food and shelter. That is not a choice, that’s a necessity. Warren Buffet has far more freedom than you do. He doesn’t need to spend any of his income on such things.

If Warren Buffet wanted, he could spend his vast money bribing politicians who are in favor of reducing his tax rate (speaking of “wealth redistribution”). Buffet hasn’t done this; many other rich people have. They have that freedom—the freedom to buy even more freedom for themselves. You and I do not.

You said you don’t believe in class warfare or wealth redistribution. That’s great—neither do I. The problem is that the market, if unregulated, has a tendency towards class warfare and wealth distribution; the rich get richer and the poor get poorer.

And if you don’t like taxes for anyone, how do you propose paying for the military, for police and fire departments, for enforcing laws against theft and fraud (laws that make industry possible to begin with), for highways that workers use to get to work, for telecommunications that people use to work and make purchases? I don’t think you appreciate just how much the “free market” is built on an underlying structure of government. If you want a free market without a government and its taxes, you should move to the only country with such a setup: Somalia.

By the way, good for you for helping out with your family (my uncle is also receiving assistance). But my family has been incredibly lucky.

Many unemployed people are not so lucky. Many unemployed people come from poor families, many of whom are themselves unemployed. Some poor people come from estranged or violent families. There are millions of people who simply have no options in this economy.

@iamthemob I agree (I think…) and I like your idea of a progressive estate tax.

Of course you have to have taxes. That is silly. But responsible taxes on a local level and responsible taxes on the federal level established under the US Constitution. There is so much waste in government spending.

People weren’t dying on the streets before social welfare programs were implemented. My goodness, please don’t believe propaganda. Study and research for yourself. Would you like to give me stats on how poverty has decreased since America’s welfare and social programs were started.

Government waste is a separate issue and is not an argument against taxes. I am also against government waste. (by the way, what is your baseline comparison for efficiency? For example, Medicare is much more efficient than private insurance schemes.)

The poverty rate is relative. Certainly, poor people today have it much easier than even wealthy people did in the 1800’s, but this is also because of technological and medical advances. I don’t think this is a question that can be answered by a simple statistic.

What do you think happened to poor people who needed medical care before social programs?

@Qingu – Progressive estate taxation is close to the system we have now. There is an initial exemption up to a certain amount (in the millions), deducted over time accounting for lifetime non-taxable gifts over a yearly allowance. After that, the percentage could grow at a more progressive rate (it’s flat at this point). Another interesting progressive element of it, I think, is the basis allowance for capital investments. For instance, real property passing to you at death is received by you at the basis of it’s value at the time you receive it, rather than the time of purchase.

@bkcunningham – I think you’ve mixed up your statement a little. You do need to watch your spin a little bit when you say things like “dying in the streets” and “please don’t believe the propaganda.” It makes you sound like you’ve drunk the kool-aid too…just a different flavor.

I’m confused though because of the mixed statement – you say no one was dying in the streets, and then state that there are “stats on how poverty has decreased since America’s welfare and social programs were started” indicates more that the poverty has decreased the way it’s phrased, and therefore we’d conclude that “Yay! That’s what they’re meant to do…help eliminate poverty.”

I think he was asking for such stats and proof that people were “dying in the streets.”

I don’t think it’s an extraordinary claim to say that poor people in the 1800’s and early 1900’s had miserable and short lives…

Doctors treated people and people paid or they worked out payment arrangements. There were Christian charities that helped. There were many private organizations that assisted the poor and still are many to this day.

@iamthemob I was repeated the dying in the streets comment made by another poster. I’m not spinning anything. I asked to see stats on how poverty has decreased since Americ’s welfare and social programs started. The fact, not spin, the fact is it hasn’t decreased.

Only one person has answered how long unemployment benefits should last for the unemployed.

@Qingu – the Industrial Revolution wasn’t the happiest period for the American worker.

@bkcunningham – How long should UE Bens last? I would say as long as is necessary and not longer.

Really?

So if I understand you correctly, you would rather poor people rely on charity and offer obscure services to doctors in lieu of payment, rather than on a taxpayer-funded basic safety net?

Okay, we have a very fundamental moral disagreement here. I think government’s job is to ensure its citizens have access to life, liberty, and the pursuit of happiness. Apparently you feel such things should be outsourced to private charities and barter arrangements.

I think unemployment insurance’s length should be variable depending on market conditions. In today’s case, it should last until unemployment gets as low as it was before the recession, or some other indication that there is actually ample opportunities for employment.

@Qingu, the government’s job is to ensure its citizens have access to life, liberty and the pursuit of happiness? Do you really believe that? I’m curious where you got that belief.

Please don’t put words in my mouth. I did not say that I would rather poor people rely on charity and offer obsure services to doctors in lieu of payment rather than on taxpayer-funded basic safety net.

On what do you base your belief that it is the government’s job to to ensure its citizens have access to life, liberty and the pursuit of happiness?

I guess it just seems self-evident to me.

Well, that and several other factors:

(1) Anarchy doesn’t work. Government is a necessary and inevitable part of the human social condition.

(2) Governments that afford people basic social security (“life” afforded both from, for example, protection against violence and protection against disease) are better than governments that do not. I base this largely on the concept of the Veil of ignorance. I am myself in a privileged position (technically I’m poor, but I come from a middle-wealthy family and have the huge benefits of home stability and education), it’s obvious that my privileged position has in large part allowed me to succeed in life. If I did not have a privileged position—or if I (for example) did not know if my children would enjoy a privileged position—I would rather live in a society that afforded me the security necessary to succeed than one in which I was doomed in a poverty cycle but in which privileged people enjoyed more wealth through less taxes.

(3) Freedom and pursuit of happiness improve the human condition. I feel like “freedom and happiness are good” is obvious, but it’s more than that. They are first and foremost only possible with (2) basic security. Capitalism only works if you have a healthy base of potential consumers able to make informed choices. When properly channeled, they lead to positive externalities, especially a Darwinian evolution of consumer technology. I think improvements in technology have been more directly responsible for the improvement in humanity’s condition—less death, less suffering, more opportunities to express ourselves and explore the universe around us—and, in turn, such improvements are best fostered in a market-type economy regulated by a democratic government.

________

I apologize if I was putting words in your mouth. You do prefer social safety nets to a society without them?

I question the use of the word “blame” in this context. Obama cut a deal. You can argue about how good or bad a deal it was, but he took what he felt he could get.

You could argue that the people got what they wanted. They voted in Republicans, so they clearly would rather have the rich people get even richer at a faster pace, that to have a bit more money in their pockets while they are unemployed. That’s what democracy is all about.

I happen to think the people are not voting in their own self interest. But their policies benefit me more than they benefit them, so it’s like being a voice in the wilderness when you’re running away from the fire and they’re all running towards it. No one can hear you over the crackle of the flames, and no one seems to notice how hot those flames are.

Oh, and—Christ’s beard help you if you were trying to set me up in some kind of theistic trap because Jefferson, a Deist who believed in a completely impersonal Clockmaker-like God functionally indistinguishable from atheism, and who called the Bible a “dung-heap” and compared Jesus’ virgin birth to Minerva bursting out of Jupiter’s brain, wrote that those rights come from a “Creator.”

@Qingu, how could I be setting you up? Unless I could read your mind and knew what you were going to say. I was just curious why you would use something from the Declaration of Independence and say, not me, but you said, “I think government’s job is to ensure its citizens have access to life, liberty, and the pursuit of happiness.”

That isn’t the government’s job at all in America.

The document goes at the core values of individual freedoms and liberties and creating a Republic form of government without respect of persons and against government intervention in our daily lives. It was drafted to King George and included a list of wrongs done against those in this new world looking for freedom and liberty.

When in the Course of human events, it becomes necessary for one people to dissolve the political bands which have connected them with another, and to assume among the powers of the earth, the separate and equal station to which the Laws of Nature and of Nature’s God entitle them, a decent respect to the opinions of mankind requires that they should declare the causes which impel them to the separation.

We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness.—That to secure these rights, Governments are instituted among Men, deriving their just powers from the consent of the governed,—That whenever any Form of Government becomes destructive of these ends, it is the Right of the People to alter or to abolish it, and to institute new Government, laying its foundation on such principles and organizing its powers in such form, as to them shall seem most likely to effect their Safety and Happiness. Prudence, indeed, will dictate that Governments long established should not be changed for light and transient causes; and accordingly all experience hath shewn, that mankind are more disposed to suffer, while evils are sufferable, than to right themselves by abolishing the forms to which they are accustomed. But when a long train of abuses and usurpations, pursuing invariably the same Object evinces a design to reduce them under absolute Despotism, it is their right, it is their duty, to throw off such Government, and to provide new Guards for their future security.—Such has been the patient sufferance of these Colonies; and such is now the necessity which constrains them to alter their former Systems of Government. The history of the present King of Great Britain is a history of repeated injuries and usurpations, all having in direct object the establishment of an absolute Tyranny over these States. To prove this, let Facts be submitted to a candid world.

The history and the meaning behind the words are really beautiful and don’t go at all to setting up a government run welfare system.

Nothing in this world is ever going to be perfect. If I had my preferences, I’d prefer a world where free markets are allowed. Equal opportunity is the American dream. I imagine it is appealing to imagine a world where we limit poverty by limiting income at the top of the scale. It has never worked. It has been tried and tested and failed each time.

The free market system is not perfect, but is better than the alternatives. The lessons of this world have proven people are better off making their own choices. Everyone wants to compare the extreme ends of the spectrum…rich and poor. You assume the poor are poor because the rich are rich. That is simple not true.

Nothing in life is fair. Everyone benefits in a free society. Even the poor. Governmental welfare systems are not the answer or they would have, in the very least, improved the plight of the poor in countries around the world and that just hasn’t happened.

Gross inequality in income offends most everyone. The free markets help make this inequality less. By changing the current taxation system in the US to take more from the rich to give to poor at the threat of imprisonment doesn’t work to help the poor have a better life.

Empowering the poor with freedoms and liberty to better their state is my answer. There is no denying that there are countless opportunities for the poor that don’t involve the governement’s hand. We must each make our own decisions and bear the consequences.

Take a look at the negative income tax as a means to give a handup to people who, by no choice of their own fell upon hard times. To say people shouldn’t be punished because of their lot in life, it must be said of both the rich and the poor.

Warren Buffet did pay for his childrens and grandchildrens education from what I remember. People like the Gates and Buffet view dynastic wealth as unAmerican. Each person gets there shot, America was not supposed to be about family status and money like royalty. I am not personally making a statement about it, just giving information on this type of point-of-view.

A flat income tax does not feel regressive to me, but huge sales tax does, especially on food and medication. My state has no income tax, although it does have dividend and interest tax, but it has a very very high sales tax, and they tax food, and I find it disgusting, the poor get screwed in my opinion.

And the poor generally work very hard, many times physical labor jobs. If you have never worked on your feet all day, you have no idea. When I went from retail to a desk job I couldn’t believe how easy it was comparatively in terms of feeling exausted, and honestly being able to work at a slower pace with less stress.

@bkcunningham have you ever earned more than $250k? I don’t really expect you to answer that question, but I can tell you that most people who earn say less than $100k, whose parents and family generally earn less than that as household incomes, and if we add have never taken any formal classes on taxes in college, or even studied up on it on their own, have no idea the tax shelters and deals in the tax code in my opinion. People who have money have people figuring this stuff out for them, and we talk to each other about the tax shelters and write-offs available. It is a different world when you have some money to throw round. I think the media should start having accountants on these poliical shows instead, or along with, economists, financiers, etc. Why don’t we ever see accountants talking straight to the public?

@iamthemob There are reasonable premises behind a general “trickle down” theory. I strongly agree with some aspects of it. For that to really work wouldn’t John Q citizen have to play his part? If he wants to get a clutch purse for his daughter but don’t want to pay more than $21 for it some factory out there making $47 dollar purses are going to suffer because everyone else wants a $21 dollar purse? ACME Purse Co. will have to cheapen the purse (then no one will want it because it is made cheap with cheap materials), cheapen the cost of making the purse (which means Joe Schmuckatelli’s job has been outsourced to India and he is now unemployed and can’t buy furniture John Q’s company makes), or just focus only on selling to the rich and upping the quality and cost of the purse to appeal to the wealthy. What carrot is there for the companies to “trickle down” stuff if the masses won’t support it?

@marinelife @ Qingu I think that saving unemployment benefits right now was key. I think that the huge deficit that we have is the result of Bush’s pursuit of the needless war in Iraq. If he doesn’t get unemployment, they will lose their home. I would have to say if it were not for the fact that I worked and paid into that system I would be homeless. My job ended just like that and I did not have any assets to sell, no stock, pleasure craft, tons of jewelry, bonds, bullion, etc. I say Obama may have had to back track on his campaign promise (for now) he did so to keep many like me from going under water. GO OBAMA!!!

@Ron_C The republicans held millions of Americans hostage so that they could protect the rich and privileged from something they wound do them no harm. Another prime example of why this two-party system don’t work. The republicans DID hold America hostage, and they will again and again, people need be like you and see through that. They do not care to lower the life boats to the unemployed because they want to decide what boat to lower and on what side of the boat and if they can’t do that they will keep all the boats from being lowered. And tie goes to he who can keep the lifeboats from being deployed. If there were other stronger parties, the Greens, Independents, etc they could have helped the Democrats put the boat in the water no matter what the Republicans thought or wished. Sadly we are not there yet. When it comes down to a growing deficit people should remember it was the Senate that wanted to raise it up at the expense of the unemployed.

@JLeslie, no offense intended to your remarks. I read through them several times and I’m not sure what point you are making. I wouldn’t be too fast to make general statements about how hard someone works or what people do or don’t know based on their income levels.

That may not be a very fair assessement. I’ve known some pretty savvy and intelligent people in terms of codes and laws and shelters who weren’t considered rich by the $250,000 or $100,000 definition.

Whatever the Gates, the Buffetts, the Helu family, Ambani, Mittal, the Waltons or the football and basketball or baseball millionaires decide to do with their money is their concern. Not mine.

Does it seem odd that someone would promote a system where the taxation laws in this country would be designed as such that a wealthy person would spend their money, perhaps recklessly, before they die and waste perhaps an industry that employs people, maybe employs thousands rather than allow them to pass it on to their children or whomever without penalty?

Not supporting either Repubs or Dems, just saying…it is odd to me that the Repubs could be accused of holding anyone hostage when they have held the majority for the past what four years.

@bkcunningham – You’re completely right to point out that there is no objective issue with there being an extreme wealth disparity. I welcome the mega-rich, personally.

The only issue with the disparity is not when there is a gap between the middle class and the mega-rich, but when there is poverty in the nation, and there’s the mega-rich. Spending on luxuries is market-productive…but when you can barely figure out how to spend your money, it’s morally questionable.

and grr…whiffs of originalism…

@JLeslie – A flat tax is exactly the same as a sales tax. If 50% of the income is concentrated in 10% of the population, and there’s a flat tax of 25%, then you have 10% of the population splitting the equivalentof 37.5% of the remainder of the nations income. the 90% must split the remander 37.5%, and there will be many at the bottom splitting a much smaller share. Assuming an even spread, that means that each person in the top ten percent is making up to 9 times every other person in the U.S. But if they are paying 25% of their income in taxes, and they are equal in income to nine other Americans…well, the simplest math (and not accurate, I admit) means that because they’re 9 people, that 25% causes only we’ll argue, 1/9th of the effect on them.

Of course, realistically, there’s a spread, and the people at the bottom would pay 25% of their income but can’t really afford to. The meager amount they contribute would be a drop in the bucket in terms of contributing to the overall tax revenue. Therefore, passing on some of their tax liability to the tax bracket would free up multiple market participants, and not cause a significant dent in the income of the most rich.

So, it seems objectively unbalanced – but much in the same way a 20% sales tax on milk may mean less milk to one family and not even an eye flutter to another, the regressive effect of a flat tax can be pretty profound.

@Hypocrisy_Central – I feel like you’re talking about global market trends when I was more talking about the freeing up of capital for those at top producing some benefit at the bottom. I didn’t really say what would work and what didn’t – just that, like most economic predictive models, it’s based on rational thought – because it can come off as crazy. So…yeah, those are problems.

@bkcunningham, but the devil is in the details.

You say people should have the rights of liberty and the pursuit of happiness… that’s great! How do you go about getting to this state of affairs? You claim “not through a welfare state,” whereas supporters of a welfare state such as myself see it as a means to this end, although imperfect. If a child is born into extreme poverty, into an abusive family, without any education or medical care, that child simply does not have the same rights that I do. A more extreme example—and something the founders fought about—is slavery. What if people take away others’ liberty by force and enslave them? What then?

You say you “prefer a world where free markets are allowed.” Me too! But, details. Does this mean completely laissez-faire economy, not even advocated by Adam Smith? Does this mean a market with no enforced laws against fraud, theft, or torts, where it’s legal to sell consumers poisons (under the assumption that the Invisible Hand will eventually punish such sellers)? Clearly, we both agree that some regulation of the free market is needed: the question is how much, exactly.

You say “equal opportunity is the American dream.” I agree! What do you mean by equal opportunity? Do I, a white male born into a rich family in a rich neighborhood with good schools, have equal opportunities as a black kid born into a poor, abusive family in an area with crappy schools? Obviously not. What do you do about such unequal opportunity? That is the million dollar question; I don’t think there is a clear-cut answer, but I also don’t think the answer is “nothing.”

Now, you go on to say several things that are just false:

• I imagine it is appealing to imagine a world where we limit poverty by limiting income at the top of the scale. It has never worked. It has been tried and tested and failed each time.
Up until Reagan the top tax bracket in America was like 70%. Seemed to work out fine during the 50’s and 60’s. Other countries also have much more progressive taxes than America (for example, Sweden) and are doing fine, have higher life expectancies than we do, better education than we do, better medical care than we do. I’m not really sure how you can defend this claim.

• _“You assume the poor are poor because the rich are rich. That is simple not true.“_
Actually, this is not my position at all. My position is that an unregulated market leads to things like monopolies and exploitation of less powerful worker classes. This is manifestly true with even a cursory examination of American and/or British industrialized history.

• “Gross inequality in income offends most everyone. The free markets help make this inequality less.”
This simply isn’t true. Not remotely. Income inequality was huge before the Great Depression (from the era of the robber barons). Then the depression hit and we got heavy market regulation. Income inequality plunged. During the 50’s and 60’s it remained stable (remember those were the good ol’ years). Enter “government is the problem” Reagan; income inequality surges. It slows down a bit under Clinton, and surges again under friend of the free market Bush.

• “There is no denying that there are countless opportunities for the poor that don’t involve the governement’s hand.”
Please explain to me what these are. I am assuming you won’t include public education and scholarships, food stamps, libraries, or the Internet.

• “Empowering the poor with freedoms and liberty to better their state is my answer.”
This is not an “answer.” This is a meaningless slogan.

Poor people who cannot afford to eat or take shelter cannot meaningfully have “liberty,” if the word “liberty” is to mean anything remotely functional. What do you think, specifically, ought to be done about this state of affairs?

@bkcunningham, two years of those four had Bush as prez, and since then the Senate Republicans have used filibusters to block almost every single initiative proposed.

@bkcunningham, you said:

• “Does it seem odd that someone would promote a system where the taxation laws in this country would be designed as such that a wealthy person would spend their money, perhaps recklessly, before they die and waste perhaps an industry that employs people, maybe employs thousands rather than allow them to pass it on to their children or whomever without penalty?”

Um, corporations are separate from the rich individuals that typically run them.

And wealthy people don’t pass their estates to job-creating industries, dude.

@Qingu I didn’t say corporation, dude. You did. And anyway, what do you mean a corporation is separate from the rich individuals who typically run them. You lost me on that one, dude.

A corporation is people. It may be stockholders or a board of directors, but it is still people.

The wealth of an individual, which is what we are talking about with estate tax, is different from the wealth of the corporation he or she runs, the corporation being the entity that actually employs people and makes useful things.

Taxing the one is not the same as taxing the other. I am in favor of low corporate tax rates in combination with extremely steep progressive tax rates.

An estate tax is used regardless of the value of the “estate” when it is willed to an individual or individuals. If you inherit a house, you are taxed. If you inherit a family farm where you have lived and worked, you are taxed. It deals with a person’s property, real or personal. And don’t forget that dreaded gift tax.

@bkcunningham I am really not trying to say wealthy people don’t work hard, I generally think the wealthy work very hard. I disagree with those who say the wealthy are lucky, and must have hurt someone along the way. But, I also disagree with people who characterize poor people as lazy. The point is most people work hard. There are people who are poor who work the system, and there are people who are very wealthy because their parets were and it was just accident of birth, or I am sure there are a few wealthy people who did just simply get lucky, but I think this is rare, most everyone works hard, and everyone who does should be able to live reasonably comfortable in my opinion, food, shelter, health care, education, safe neighborhood. That is what I want. I feel the desparity between the classes is too great. The greed has gone too far. I’m a capitalist at heart, but people cross the line, moving outside of a place of integrity in my opinion.

@iamthemob I am trying to understand your math, and I am generally good at math. I am all for the lower class not having to pay an income tax. I am also good with having a combination income and sales tax. I am never ok with food and medicine being taxed. A tax on spending, if all they can afford is food and shelter, means that person is paying very little tax in my plan. If they make $60k let’s say, and the tax is 20%, they pay $12k, the guy making $6million pays $1.2 million. If one person makes $3million, he pays $600k, and the other guy makes $3,060,000 he pays $612k add it up, same amount to the government no matter what each person makes. I guess you are saying the person making $60k can’t afford the 20%? My problem is with how it is set up now the rich guy is paying less than 20%, and the middle class more. You might be able to talk me into taxing the rich more, if they really paid more.

Okay, but how does that have anything to do with your claim that untaxed estates will somehow support industry or create jobs?

@JLeslie – Yeah, I wouldn’t argue for any person of a lower income paying higher percentages than someone above them (bracket wise). How to make it work…up for debate.

The funny thing about the sales tax route, of course, is that it promotes fiscal responsibility in an odd way, and actually increases an incentive to buy less, reducing both state revenue and market participation.

So lame.

I never claimed an untaxed estate would support anyone or create jobs. I’m just making the point that if you tax an estate, you take away the incentive for someone to leave that estate to exist and for others to perhaps benefit from it in a variety of ways depending on what is included in the estate. It is a penalty for having accomplished something in your life. I simple don’t agree with that.

Suppose someone owns a business that they are going to pass to their children. They know when they die the property is going to be taxed, currently the tax is 52 percent if reinstated as the Democrats wanted. The business has fallen on hard times in this economy and is barely making a profit. But the owner has kept the business going and people employed. Upon his death, what happens if the heirs who work for the business can’t come up with the instant monies required to pay this tax.

Why should you be penalized for being prosperous?

The people who would benefit from the estate almost certainly don’t need it.

It’s fairly dishonest to suggest that rich people are “penalized” for being taxed at a higher rate. Taxes are not “penalties.”

I don’t really understand your question about heirs. How would heirs of a fortune not have the money to pay for a fraction of that fortune’s value in tax? (They have the fortune, correct?) And what do the heirs have to do with the corporate structure that employs the people? I mean, I understand that this is sort of the mythology of trickle down economics; walk me through how this would happen in real life.

Wealthy people should be taxed more because their money has less value to them.

@JLeslie to live reasonably comfortable, have food, shelter, health care, education, safe neighborhood, that is what most people want. The best, not perfect way mind you, but the historically proven best way to achieve that is with the free market systems. It has been proven again and again that this is what provides a means for people to obtain a good life, maintain liberties and to pursue happiness. Government regulations on the smallest local levels by all means possible is another way to insure our free markets operate in a proper manner.

There are courts in this country that were set up as a means to compensate and/or penalize people who do wrong against others. That is part of the governmental way to help oversee free markets.

We are always going to have greed. Who isn’t greedy or looking out for their own best interest? There are always going to be poor. But take a look at the poor in countries where free markets have been introduced.

To say that taking money from people by force is good for the economy or the poor is just plain not true. If there is a service we can have the government provide that provides a better service than we can do on our own, that is wonderful, if it is true. But in order for that to happen, it should take place on the most local level possible.

What exactly do you mean by “free market system,” @bkcunningham?

I don’t think anyone has argued that a command economy is preferable. By free market, do you mean purely lassaiz-faire? Do you mean with light regulation (such as against monopolies, laws against fraud, etc)?

Also, what does the degree of freedom in the economy have to do with the nature of taxes and social programs?

@bkcunningham – I would like to see what you cite to prove that the historically proven best way to achieve what you state is through the free market system, but more importantly what @Qingu asked – how are you conceiving of the “free market system.”

Historically, Mao’s revolution dragged more people out of poverty at a faster rate than any free market system. Of course, it also killed millions of people…

@Qingu, to put free markets in a digested explaination. It is the brain-child of Milton Friedman, who was a Nobel Laureate economist, writer, philosopher, et al. He describes himself as a liberal in the true sense, of and pertaining to freedoms.

His economic theory of free markets is very basically based in part on the meaning of the phrase The Invisible Hand coined in the book by Adam Smith in The Wealth of Nations. Individuals who intend to pursue their own self interest are lead by the “invisible hand to promote the public welfare which is not part of their intent.

In order for someone to make an income, you must produce something that somebody wants to buy. In the process and the interest of making a profit, the person looks after the interest of their customers.

Friedman explains their are winners and losers in the free market, that is life. We can never change that. Every day we all make decisions or gambles in our own lives. Each time, the question is, who makes the decision; we or someone else. That is what the free market system is basically.

You must understand freedom to really understand free markets.

America was an example of free markets prior to Progressive ideology guiding the economy and financial markets. The best example of the free market in recent times is Hong Kong. The best example of the opposite of free markets where government intervenes in an economy is Greece and what is happening in America with the Fed and other government imposed regulations and manipulations.

Look at the history of Japan and what happened when the began following the British and free trade.

@Qingu – That reads a little more like ideology than a statement of how you see free market economies working in a global community, how much regulation is sufficient, etc. If you make the claim that it is the best, you have to be working with a specific model – whereas I think it’s more likely that what we’ve discovered that a capitalistic structure has been the most successful, and how much we allow the mechanisms of capitalism to regulate themselves is up for debate.

It’s almost insane how regular the failure of unregulated free market economies seems to work. Boom economies regularly seem to end up pushing speculation past information, and confidence in the market results in bubbles engendering confidence in a market that’s unwarranted. And economic successes often lead to a lack of attention to social issues.

Japan is an example – the lost decade – http://en.wikipedia.org/wiki/Lost_Decade_(Japan) – is an odd mirror of the funhouse variety to the current U.S. crisis. And successful recovery from the asset bubble burst has been attributed to government stimulus.

Aside from its successes, though, 1/6th of Japanese citizens live below the poverty line. It’s also an awkward comparison to the U.S. in terms of its market success when you consider the pervasive cultural and racial homogeneity of the nation. And the success isn’t without it’s victims – suicide is the leading cause of death for men under 30.

I don’t know what you see as the imposed regulations and manipulations, but bailout – infusion was intended to loosen the credit vice and encourage people to extend credit in order to incentivize business growth. Of course, this came with individual regulatory requirements – but these were essentially contractual as between parties almost as in a standard stock/asset purchase agreement. The major regulatory pushes under TARP, etc., were limited in character and by intent limited in time.

If we talk about major successes, I would argue that the most profound economic and cultural success of modern history was the Empire system. The global expansion that occurred under the British Empire is essentially why we’re here. And this push and expansion was clearly state-oriented and nationalistic. It was aristocratic and monopolistic too. The U.S. and other western expansion into developing markets is almost a new version of this, where we are mirroring much of the colonialistic behavior of that era in a corporatocracy rather than an aristocracy.

So I’m not clear how you adopt the consistent bubble behavior of highly lassaiz-faire economies or unregulated markets within economies with the idea that it’s the most successful model.

Ye gods…

That’s not Friedman.

That’s, like, high school econ.

It’s not The Wealth of Nations either. Well, maybe the introduction.

American markets before the depression often devolved into monopolies and hellish boom/bust cycles and crashes and workers had almost nil functional “freedom.” In no universe was this a best practices example of economic policy.

Hong Kong is not the freest of markets.

Greece is not the opposite of free markets.

The modern Fed’s intervention in the economy is limited to monetary policy which was the brainchild of… Milton Friedman. Alan Greenspan and Bernake are Republican libertarians…

I don’t really know where to start. I’m sorry, but you don’t really know anything about economics. You’re not actually qualified to have this discussion at the level we’re having it. Your mention of Greece leads me to think that you are simply parroting something you’ve been watching on a Fox News opinion show or talk radio.

@iamthemob, I’m assuming you meant that to @bkcunningham and not me?

@Qingu – Absolutely. Thematically that was clear. ;-)

Friedman wanted to do away with the fed dude.

Be honest, you had to look up The Wealth of Nations and Friedman. Be honest with yourself, if not with me. Go back and really study Friedman and what his approach with free markets means.

No. I had to read WoN in college.

(not all of it)

Give me a summary of what you believe WoN says.

It says a huge amount of things.

The most basic and illuminating point Smith makes, I would argue, is that trade is not a zero-sum game.

The invisible hand was also important, but Smith wasn’t a libertarian; he acknowledged the need for certain limits and regulation.

As for trade, Smith was for allowing the colonist to trade as they saw fit. Smith advocatesd something like the ancient Greek practices in colonisation

May I ask how old you are, sir?

Yes, you may ask. I’m a 49 year old woman. How old are you, if you don’t mind?

Ma’am. I’m 28.

@bkcunningham – I’m still confused as to what you’re really trying to get at when you talk about free markets. You are making broad strokes as to what it means, and referring to old school basics…but I really don’t understand why the fluther we’re talking about what Adam Smith said. Free market economies are kind of like a unicorn…the rhetoric of free market capitalism is more about the catch phrase than it seems to be about functioning models. And I wonder if Adam Smith would even understand what the hell we were doing with credit default swaps and mortgage-backed securities.

I don’t feel like we’re really talking about how the current tax policy, for instance, is beneficial unless we get at the regulatory theory underlying what you perceive as an actual, functioning “free market” style methodology.

Because again, the current crisis seems to be more about market induced bubbles than CRM or Fannie Mae.

Adam Smith is relevant because so many of Friedman’s thoughts were based on so many of Smith’s beliefs. You are over thinking it, IMHO. It isn’t that complex.What is wrong with old school basics? Too much federal government intervention in every aspect of our lives has gotten us in the mess we are in today. It has moved us away from the Founder’s principals and beliefs. Friedman believed in many of those same beliefs and principles.

@Qingu, why did you wonder about my age?

@bkcunningham – Principles are great, but they’re far from practice. Moving from what the founders wanted is a functional necessity of the radically different economy that we have today, as well as the radically different society. The principles set forth by the founders were broad because they were smart enough to know they didn’t know what was to come.

I don’t know if Adam Smith understood that you could package a financial product, hack it up, and leverage it based on a less-than-thoroughly researched understanding of the market as well as the contents of the package so that a collage of different debt agreements could be sold to a bank at ten times the value of the risky asset agreements backing it up…well, if you’re selling something that is a combination of bad debt in a market that demands such a product and is willing to fund it at multiples of the value of the assets…I think he would wonder who was watching over all of this…

What is the entire foundation of the financial markets @iamthemob? What is the basis of the financial markets, debt agreements, banking, assets etc.?

@bkcunningham – Faith in paper disconnected from resources that can be clearly valuated? Greed?

@JLeslie – I found this – it appears that MIT independently researched “my idea” of progressive estate tax policy without me knowing.

I should have copyrighted.

@bkcunningham Proof of free markets working is the US I would guess you would say, but the truth is one of the reasons we became so prosperous and wealthy as a nation is several factors in my opinion. Capitalism, unions, regulation, and innovation, and industry. I tend to be anti-union, but there is no getting around the fact that companies were abusive and stingy, and organized labor helped to grow our midde class, which differentiated our country from others. Now, it has all run a muck again, and the the wealthy are getting, well, too wealthy. There is a place of diminishing returns in my estimate. The wealthy will only buy so many houses and yachts, but then a midde class guy will spend the majority of his income. If you have one person making $10million, or 100 making $100,000, more money will be spent by the 100, which moves the economy, and creates a better life for everyone. Now, I am not advocating for everyone to make the same salary or for communism, I am only using that as an example.

We have fallen behind on innovation and willingness to change, we need to catch up and lead again on those fronts.

@iamthemob I was thinking more in terms of the Federal Reserve, The World Bank, the IMF??

Debt servitude?

@JLeslie let’s take someone, like Bill Gates for instance, who is worth $53 billion. How many jobs do you suppose he created and how many families has he fed and clothed and provided medical care to? How many charities has he donated to? What are the residual effects of this one man being part of a free market society? If you were appointed the moral judge of the world’s income levels, at what point would you have stopped Gates and his fortune?

@bkcunningham – The Bill Gates example is a great one, because it’s as much an example of how the free market actually creates inefficiencies in the market. At the beginning of personal computer and OS development, Gates tried as hard as he could to prevent open-source development from happening, basing his arguments on competition in the market. Of course, the scientific community works best at software development when they have free access to source code, which Gates worked to lock down. Now, the open-source theorists developed software for free and provided service and expertise for free…and Gates did the opposite. So now, we have buggy releases that are slow to fix, and outsourced service that is subpar on his side, and open-source on the other – smaller, independent innovative. And of course, the IE/Netscape antitrust suit…

Competition in the market is based on much of the time creating barriers to market entry as it is being innovative and productive. U.S. automaker lobbying in the 70s is a good example as well, pet science research from the oil industry debunking climate change as propaganda to ensure that investment in alternative technology is delayed…etc.

Morality in business was, in fact, a central theme to Adam Smith’s assertion that the free market could work. Our market is divorced from a sense of social responsibility – in many ways from a sense of “hard value” too.

It seems like you’re conflating the ideas of capitalism and free-market economy. At this point, I think it’s time you put out what you think are the basic working pillars of what you’re talking about when you say “the free market.”

@bkcunningham it seems to me Bill Gates could have sold his products at half the price, more people would have had access to the technology, and he would only be worth $21billion. Still good. I know the math is not that simple, but that would be my take. At least Gates is spending a lot of money on charities I really care about, so that helps me be ok with it, but plenty of wealthy people don’t. Gates also will not be giving the bulk of his wealth to his children, and he believes in raising taxes on the wealthy from where it is today. @iamthemob gave some great info also.

Like I said before, what Bill Gates does with his money isn’t of concern to me. But for discussion, is it fair that his children will still greatly benefit from his vast wealth. Also, Gates has spent $18 billion to help deliver life-saving drugs to 250 million poverty stricken children, preventing approximately 5 million deaths. So with your philosophy, we must cut that in half. Sorry poverty stricken children.

In an interview, Gates also said he would still be leaving some money to his three children.

“I will give the kids some money but not a meaningful percentage,” he said. “Setting the number so that they need to work but they feel reasonably taken care of is hard to figure out.”

He may be calling you to help him figure out how much to leave.

@bkcunningham are you talking to me? I actually am not against families passing their wealth to their heirs, he is probably giving less to his children than I would. I would hope the wealthy have a portion of their gains go to charity. I prefer not to rely on one person who has amassed huge amounts of wealth to do right with his money like helping children, that is a lot of reliance on one person. We got lucky that this brilliant man also believes in basic health and education for everyone, I wish he was dictator lol.

Sometimes my @ thingie doesn’t work. And how do you link to the text style for stong and whisper? How I wish there was spell check here. I’m a horrible speller.

One wonders why Bill Gates supports Democratic candidates who want to raise his taxes.

@Qingu, not really.

Why do you suppose Gates supports Dems? My @ thing isn’t working again. I wonder why?

Well, @Qingu you made me wonder with your question. So I looked up. Here is the list. He actually gives almost as much to Repubs as he does to the Dems.

http://www.newsmeat.com/billionaire_political_donations/Bill_Gates.php

I suppose he supports whoever is going to support him and his business interests.

I suppose a lot has to do with how you define “rich.”

Ah, touche. He’s a “corporatist.”

Do you oppose antitrust laws?

After all, if Microsoft was allowed to become a full-balls monopoly, maybe Bill Gates would have a trillion dollars! Maybe he’d be able to buy America and make our country a utopia with his philanthropic benevolence!

@Qingu, antitrust laws have changed over time. Originally, it was thought that antitrust laws were one (of the few) things the government could do to help promote competition. To me that was a good thing.

Over time, it became apparent that instead of promoting competition, they did the exact opposite mainly because they were controlled by the very people the regulations were suppose to regulate and control!!

How much money and time was wasted with the United States v. Microsoft case? Still, we see the government moving more and more to take over the industry.

That’s… not an answer.

It’s interesting that you don’t think Microsoft was anticompetitive.

You were alive during the 90’s. Were you living in a cave, perhaps?

How is the government “moving more and more to take over the industry?” Please God don’t say net neutrality.

Sorry, @Qingu. It’s the best I could do. Don’t forget I don’t really know anything about economics. And not actually qualified to have this discussion at the level you’re having it.

@bkcunningham Gates’ father proposed a new income tax for Washington State, and his son supported it. Here is the thing Republicans as of late want people to believe you cannot be pro-business and still want universal healthcare and equal education for everyone. I think Bill Gates understands can.

That bit of terror the right wingers, I don’t mean the average Republican or conservative, but the far Christian right, feel when their politicians are pro-choice and married twice and are atheists, that is a little ow I am feeling right now with taxes being kept at the Bush level, social security being cut, and I am waiting to see where the spending will be cut, and I would love to see the specific plan to pay off the debt. I would love to see a chart shown to the American people about how much we will pay if we pay the debt over a long term. Like when you buy a house with a mortgage for $150k and you learn over thirty years you will actually pay $350 to pay it off. Debt creates that little bit of terror in me. I feel less secure.

If you have moved a few spaces ahead the drop down for the @ will not work, so you need to backspace or delete to get back to the margin, moving the cursor when words or spaces are already typed after the point where you want to start your @ creates the problem you are most likely having. It seems that if you use the @ and type out the full user name, if the drop down is not working, it sometimes appears red once you hit answer, but sometimes it doesn’t I have not completely figured that out yet.

Some of the tips for italics and whisper are immediately below the box you type in for an answer. Underscore at the beginning and a sentence will italics, double dash on both sides of a sentence is the smaller font, astericks either side of the sentence bolds the text. Use the symbols no space.

Fantastic discussion all love it. I am learning way too much. Trying to define the free market is impossible, the free market is a myth. Without the government no industry in this country would have thrived to the extent that we have today. From roads, to fair working practices, to the internet, and almost every industry that you can think of, the government has helped in that industries success. If there was a free market we would now be called Standard Oil land.

I saw a John Stossel show recently where a guest talked about what helped make America so prosperous, and other countries as well, was rule of law and trust in government. He noted that in countries like America being able to buy and sell items with paper is what changed everything. You can buy cattle without seeing the cattle, real estate, etc., because we trust the documents the things are sold on. In the third world people still need to go to or bring the goods, slows the process, and especially previously made transactions only realisic on a very local level. He showed communities where the government never laid out a specific sytem of roads addresses and property rights, and there were literally apartments built on top of other buildings, where the guy who owned the original building did not really have title, but basically had just been there for many years. Being a country of laws seemed to be one of the fundamental necessities to promote economic growth.

@bkcunningham – I feel like your comment about your background and knowledge in economics must have been a sarcastic response. If it wasn’t, I don’t understand why you stepped in to discuss the issue and claim that the free market was the answer. If it was sarcasm, though, I still haven’t gotten an answer to my question regarding your concept of the free market.

It really, and I’m not trying to be pointed, but it really sounds like you’re committed to the rhetoric of the free market rather than a practical concept of market regulation. When you say that progressivism is an issue, you group ideas that are practical and position them as against the rhetoric that you’re supporting.

From what you’ve posted here, it sounds like nothing but propaganda based on basic notions from theorists working in a mythical and/or outdated market.

@JLeslie – We also take that a little far. Separation from ownership ends up creating a lot of externalities that we should be paying for. The exploitation of developing populations and environments is a fairly common example.

@iamthemob Can you explain further what you mean by externalities? I feel buying and selling “paper” has its dangers as we have seen in our history, but I am not 100% sure what you are getting at.

@JLeslie – Generally, costs associated with the item purchased that aren’t built into the price. Paper has its examples. However, the less we see production, or even the product, the more common that is. And when you factor in diversified corporate ownership…yowser.

@iamthemob I’m still confused, sorry for being daft here. Costs associated, but not built into the price. What costs?

@JLeslie – Negative externalities.

Externalities are the number one reason why libertarian economics is absolute bullshit. The “free market” has literally no incentive to build in costs associated with them.

(The number two reason is that most people are not rational actors… I could go on a rant here, but I won’t…)

@JLeslie, it is welfare economics that they are touting.

@bkcunningham who is they? @iamthemob and @Qingu? I’m pretty sure I lean more their way than yours on a lot of topics related to the economy and politics. I say lean, I think I am probably a fiscal moderate, but if I have to pick a side I am blue. I say I am a capitalist, but capitalism and free market left to itself can have horrendous consequences, because money is power. Look competition is great to bring the best to the customer, but it only works in its pur form when there is competition. When there isn’t a company can suck the life out of an individual. There has to be regulations, and ceilings, and rules against monopolies. I think of America as a hybrid of many ideas, a system we are constantly tweaking over the years. We have social systems and capitalism all at once.

@iamthemob Thanks for the link.

@bkcunningham – If that is us you were referring to, then I think I’m comfortable in calling bullshit on you at this point. @Qingu and I are talking about economic policies that take into account both government, corporate, and consumer responsibilities as well as the liberties. I feel like I’ve asked you about 20 times to say what you mean by free market and gotten nothing but rhetoric and sweeping statements.

@JLeslie – No problem!

All the posturing, saber rattling, and economic systems aside if it good politics to not give quarter to appear to have cajones and be the shot caller if it means 100s of 1,000s or millions of people will lose the last lifeline they have. And if those people are thrown under the bus (Democrats and Republicans) so that now not only are they homeless and drawing off the government dole and not their unemployment, not paying their bills (or the ones they can still make) is that over all good for the economy or bad? If you remove or severely reduce the amount consumers are spending what “trickle down or up” effect is that going to have on the economic recovery? Riddle me that?

@Hypocrisy_Central, you are probably right, but if Obama doesn’t start fighting Republicans in earnest at this point I think the strategy of “hostage negoatiation” is going to cause more harm than good in the long term. If you give a mouse a cookie…

@Qingu The deal maybe ugly but doesn’t the ends justify the means? With a hold out who stood the chance of losing more right off the bat, the working and middle class who have the least anount of assets, credit, and savings to stay afloat with or the rich who can last maybe years off their assets, passive income, savings, and credit? In this case what do the Democrats believe the cost of winning should be? If you wage a war you don’t have to fight but winning it leaves 65% of your country wasted how sweet will the victory be? I say one has to pick their battles in which to “fight the good fight”.

I have come around to the position that the deal is the lesser of two evils, but our government cannot continue to reward obstructionism in the service of plutocrats. If we continue to do this, if this becomes a proven strategy for the Republicans (and it already has) then I feel that the long-term damage, including to the very people you’re talking about, will outweigh the benefits of negotiating.

@Hypocrisy_Central, in your previous statement, ”...now not only are they homeless and drawing off the government dole and not their unemployment…” what do you mean, not drawing off their unemployment? Where do you think the money to pay the extended unemployment benefits is coming from? It is coming from the “government dole” at a cost of about $65 billion.

@iamthemob call it what you want. The points you made sounded like welfare economics to me. I have discussed and tried to explain what free markets are and my beliefs in them. I really don’t know any other way to explain it so you can understand.

@bkcunningham If the government wanted to scale back a couple of drones or ax a couple of dozen cruise missiles it would be easy. Is it good politics to allow those who are hit by hard employment times to go belly up? Wasn’t the reason for the stimulus to get people spending again so factories and manufacturers could ramp up production and create jobs? Is throwing millions under the bus helping that? Especially when it is all to prove ”I won’t blink 1st”? Again, Obama holds out to show he is the hog with the big nuts who is going to suffer more and faster, the rich or the middle and working class?

Where do you think the money is coming from @Hypocrisy_Central? How’d that stimulus work anyway? Unemployment didn’t go down, people aren’t back to work like promised. How’d that work for us?

@bkcunningham No the stimulis didn’t work as it should so having people come by with less money will be better? Still how would tossing millions of people under the bust be good for this econoimic recovery? I have not heard that. Unemployment extensions aside it is cheaper than 15 cruise missiles. They find money in the cushions of the sofa to sink down the throat of a Middle Eastern sand alligator and that is not helping the economy unless you are Blackwater and Halliberton.

@Hypocrisy_Central Back to your earlier point of the consequences of not allowing extended unemployment benefits that you described as ”...now not only are they homeless and drawing off the government dole and not their unemployment…” what do you mean, not drawing off their unemployment?

Where do you think the money to pay the extended unemployment benefits is coming from? Since you moved away from your point of the unemployed drawing off “their unemployment,” I can suppose you acknowlege that the money isn’t coming from “their unemployment.” So where is the money coming from that will prevent the unemployed from “drawing off the government dole” which you said was a consequence of giving more money to people who are not working?

@bkcunningham the way all of the politicians are acting the money for all of the unemployment is coming out of thin air, which basically means China or the printing press. Scary shit.

Corporations have amassed TRILLIONS of dollars in cash reserves while the people are told to go get a job. So while the corporations , (who eliminated the jobs so as to increase their profitabilty) increase their dividends, buy back their stock, pay out handsome bonus’, refuse to hire, continue to report better than expected earnings. The people are grateful to be able to work harder and longer for the same or less because at least they have a job.

The cash reserves directly correlates to apprx 5.5% percent of the unemployment. Which is the cause of the continued stagnant growth. But who gets vilified? The unemployed, what a great nation we have turned out to be.

The stimulus did work. It wasn’t big enough to reduce unemployment to an acceptable level but it worked for what it was.

@bkcunningham the money for unemployment comes from the same place that the money for social security, medicare, and predator drones comes from. Why are you asking this question?

@Qingu I’m trying to understand your point. You still aren’t answering the question. Where is the money coming from? That seems like a logical and sensible question.

The same magic land that pays for tax cuts and wars. At least this time we are helping some of our own people.

OH and Medicare prescription drug program, and no child left behind.

Taxes? Are you trying to make some rhetorical point about how taxes fund social safety net programs? That’s not exactly shocking to me.

@Hypocrisy_Central I was trying to understand your statement, “And if those people are thrown under the bus (Democrats and Republicans) so that now not only are they homeless and drawing off the government dole and not their unemployment, not paying their bills (or the ones they can still make) is that over all good for the economy or bad?”

I was trying to understand the difference in “drawing off the government dole” and your logic it wouldn’t happen if we extended unemployment. You answered my question. It is all coming out of, as you say, “the government dole.” It just didn’t make sense to me is all. That’s all.

@Qingu, tax dollars are actually only being spent on the interest payments of our deficit.

Wow, okay.

Wikipedia:
Budgeted net interest on the public debt was approximately $240 billion in fiscal years 2007 and 2008. This represented approximately 9.5% of government spending. Interest was the fourth largest single budgeted disbursement category, after defense, Social Security, and Medicare. Despite higher debt levels, this declined to $189 billion in 2009 or approximately 5% of spending, due to lower interest rates. Average interest rates declined due to the crisis from 1.6% in 2008 to 0.3% in 2009.

Why on earth do you believe what you just wrote?

@Qingu Interest is the fourth larget sdisbursement? Oy, my stomach hurts.

The deficit is a real, huge problem. (It’s not just because we hate rich people that liberals oppose the Bush tax cuts for the wealthy)

But we need to prioritize problems—and a bigger problem is the recession’s bloody swath of unemployment. The only realistic way of fighting this problem is increasing the deficit. Successfully fighting this problem will decrease the deficit.

@Qingu, So what? If your information is accurate, it just goes along with what I said. Listen, I really don’t understand why you are so adversarial with me. I haven’t done anything to you. I don’t even know you. This is a discussion board and I’m new here.

It isn’t about Dems or Repubs or liberals or hating rich people to me. Or rich hating lliberals. I happen to have a lot of very close dear friends who have very, very left, liberal ideas who make loads of money. On the other hand I’m friends with plenty of conservatives who barely have a pot to piss in.

It isn’t even about trying to prove that I’m right and you’re wrong. I am just offering information for you to look at and research and learn from if you can. I appreciate when someone gives me information to research and look into.

With that off my chest, I just wanted to put out there this information from the US Treasury Dept. Congress failed to pass a budget for FY 2011. According to the US Treasury, our national debt , today is $13.8 trillion. In 2006, our total debt was approx. $8.5 trillion, in 2007— approx. $9 trillion. In 2008, our debt was approx. approx. $10 trillion, in 2009, our debt rose to just a little under $12 trillion.

It is unsubstainable. The Treasury Dept. has the third largest expense in the federal budget. The two larger than the Treasury Dept. are teh Dept. of Defense and income redistribution which is done through the Depts. of Health and Human Services, HUD, and the Dept. of Agriculture (food stamps).

As the debt increases, so does the interest payment. Social spending is the largest item on the federal budget.

There is a huge decrease in the expenditures of the Treasury Department. Its budget includes the interest payments on the national debt and the budget to run the IRS. How could this decrease possibly occur? Interest rates have dropped from 2009 to 2010 to 2011. But the debt has not gone down; and the Department is not getting smaller.

Meanwhile, there is also a huge increase in the Department of Labor expenditure for FY2010; and the Department of Education spent almost double in 2010 what it did in the previous year. There are other budget increases.

Just for clarification: “entitlement” expenditures are spread out over several agencies, not just Health and Human Services. Agriculture Department administers “food stamps”, HUD is all welfare.

In FY2010, the Treasury Department spent $414 billion of our money on interest payments to the holders of the National Debt. Compare that to NASA at $19 Billion, Education at $93 Billion, and Department of Transportation at $78 Billion.

@bkcunningham – You haven’t explained how free market would solve all of these questions, and have not shown why the bubbles weren’t caused by them. All you’ve done is spout rhetoric.

I think the adversarial aspects that you’re seeing are attempts to get you to see that you’ve simply, again, swallowed a different flavor of kool-aid. As someone who worked on the bankruptcy restructuring of the compensation and employment benefits structures of a TARP recipient and was working during the crisis while the regulations were being passed, no one but the pundits were saying what you were.

@bkcunningham, I will tell you exactly why I’m adversarial with you: because I think much of what you say is simply not factual. Now, you are obviously a polite internet person (moreso than I) and in real life I am sure you are a pleasant person as well, and I hope you don’t take my tone personally; I am a curmudgeon. That said, well, let’s look at your latest post:

You said it’s not important whether your statement “all our taxes pay off debt interest” is actually true. Yes, it is important, because truth is important. The issue of how our taxes are spent, how government should spend tax revenue, are some of the most important issues facing us today. And when you don’t approach them with a respect for facts, you’re not respecting the issues.

As I said, I agree that the debt is unsustainable and a huge problem. But—unlike under the Bush administration, which was not facing a financial meltdown and 10% unemployment—adding to the debt today is the lesser of two evils.

One obvious way to get the debt under control, once employment is stabilized, is to increase taxes. The most moral way to increase taxes is with progressive tax brackets. We should go back to Nixon’s tax rates.

The other option is to cut one of the three: Medicare, Social Security, or Defense. I think citizens in an industrialized country have the right to medical care and a social safety net; and while I’d like to trim defense, I don’t think it’s politically feasible. So I think the best option is to raise taxes, mostly on the wealthy.

Nothing you brought up, none of the expenditures, will come close to bringing the debt under control. Now, you can rant and rave about how the debt is evil until you’re blue in the face, but unless you are offering actual ways to bring it under control, what’s the point?

I should clarify: adding to the debt today in ways that stimulate the economy and bring down unemployment is the lesser of two evils.

Adding to the debt today just to give millionaires extra money they don’t need and aren’t going to put into the economy is not the lesser of two evils, it is pandering to a far-right ideology with no practical payoff for the American people.

Okay, let me give this another try @iamthemob. Of course I’ve never said, nor has any of the other pundits of the free market economy like Nobel Laureate in economics, now deceased Milton Friedman; Dr. Thomas Sowell; Ben Bernanke; Anna Schwartz and countless others, that free markets create utopia. Utopias don’t exist.

I disagree with Keynesians in the belief we can use deficit spend to create employment. The current situation we are in is proof of that. Of course, I know you and others of the ilk will say, “oh, we just haven’t spent enough.”

In the past two years, spending has reached a point that is maked up 24.7 percent of the GDP in 2009 and over 25 percent in 2010. Over $1 trilliion has been added to the national debt in both, BOTH 2009 and 2010.

The US government has become the effective operator of several too big to fail companies. To be an efficient regulator of industry, the govenment must remain neutral and disinterested. That was not the case with the current administration.

The Troubled Asset Relief Program and other similar bailout programs for a variety of financial institutes have allowed the government political control. If you accept taxpayer money you must allow political control from DC, right?

The solutions that I see are to reduce tax rates, end government intervention that started in 2008 with TARP, reduce government involvement in commercial decision making and keep overall federal spending to less than 20 percent of the GDP, that is the historical post-World War II average for federal spending and add some discipline to entitlement spending with long term budgets and reviews of affectiveness of programs to name a few.

@Qinqu, I don’t know what you are smoking dude, but your statement, “You said it’s not important whether your statement “all our taxes pay off debt interest” is actually true…” Man, I never said that. My statements were true. Go back and reread whatever you were referencing. I don’t use wikipedia as a source and since you did, I was just saying I don’t bother to verify wikipedia since I don’t use that site. Since you used that site, I said, assuming your source and info was true, it wasn’t an arguement against what I was saying. It only complimented what I said dude.

@Qingu show me in the US Constitution that Americans, I’m talking about this country, have a “right” to medical care or a social safety net.

Explain to me how expenditures bring the debt under control. That wasn’t my point in pointing out expenditures. You have to bring spending under control to get a grip on the expenditures. The govenment has never shown restraint with surpluses. Show me a time when they have.

I am not a constitutionalist. But I do think medical care and social security fall under the founders’ ideology, which was that people have the right to life, liberty, and the pursuit of happiness.

I’m not sure why you think I claimed that expenditures bring the debt under control; I said stimulative expenditures in a Depression are the lesser of two evils.

Clinton’s government showed restraint.

@bkcunningham, you said:

“tax dollars are actually only being spent on the interest payments of our deficit.”

This is a false statement. It is ridiculously false. In 2009, only 5% of our spending went to debt interest payments.

If you don’t believe Wikipedia, please check the source cited in the Wikipedia article. It’s a pdf. The relevant data is on page 15.

@Qingu your statement regarding the expenditures, “Nothing you brought up, none of the expenditures, will come close to bringing the debt under control.”

But that is true. Unless you are willing to cut a huge chunk of SS, Medicare, or Defense, you are simply not going to come close to handling the deficit. This is doubly so if you cut taxes.

Now, you went on to say you want to reduce expenditures to 20% of the GDP… tell us, specifically, what you’re going to cut.

I have read, reread and read again not understanding what the hell you were talking about until now. I see my word “only” and I guess I meant “also.” I don’t know why I typed one thing and my mind was seeing something else. Even after reading it fifteen times, my mind saw something different than I typed everytime I read it. Sorry @Qingu. I submit that one to you.

Some of the ideas that have been discussed among some fiscal conservatives that I think deserve consideration are requiring Congress to enact a FIRM cap on the annual increase in total government spending, limited to inflation plus population growth. Remember the promise of going through the budget line item by line item? What a dream if someone had the balls to do that.

PAYGO, which is a joke now with so many loopholes and exemptions for discretionary spending (40 percent of the budget BTW) and emergency stimulus bills, would help if there really was used like it was intended to offset the cost of new initiatives.

The responsibilities of federal agencies for transportation, agriculture, and education should be transferred to the states.

Rising costs in Social Security, Medicare, Medicaid and net interest are responsible for almost 5 percent in additional deficits as a share of GDP by 2020. This must be addressed.

If the US were smaller and part of the EU, it would lose its A credit rating, have trouble refinancing and ask for the rescue umbrella. Like Ireland just did. Condition: Raising taxes.

But fortunately for the US it’s big and all rating agencies are American. The illusion of being able to afford tax cuts will live on.

For a while.