Obama/Biden vs. McCain/Palin

[Reality_Check]

That looks like income taxes. Show me where he proposes to cut payroll taxes. And remember, payroll taxes affect those living paycheck-to-paycheck alot more than 'the rich'.

From the same source as my previous post:

Senator McCain's New Tax Cuts. I don't see a payroll tax cut.

"Increase the dependent exemption by two-thirds (phased in)

Reduce the maximum corporate income tax rate from 35 to 25 percent (phased in)

Allow first-year deduction of 3- and 5-year equipment, deny interest deduction (expires)

Convert R&D credit to 10 percent of wages incurred for R&D, make permanent

Suspend federal gas tax for summer 2008"

================================================== ============

Senator Obama's New Tax Cuts. That first one sounds like a payroll tax credit/cut.

"Refundable "Making Work Pay Credit" of 6.2 percent of up to a maximum of $8,100 of earnings

Refundable "Universal Mortgage Credit" of 10 percent of mortgage interest for nonitemizers

Eliminate income tax for seniors making less than $50,000 per year

Extend childless EITC phase-in range, increase phase-out threshold

Increase EITC phase-in rate to 45 percent for families with three or more children

Increase to $5,000 the add-on to EITC phase-out threshold for married filers

Make CDCTC refundable and increase maximum credit rate to 50 percent.

Make saver's credit refundable and change formula to 50 percent match up to $1,000 of contributions

Make permanent R&D credit and renewable energy production tax credit

Mandate automatic 401(k)s and automatic IRAs

Increase Hope credit: 100% match rate on up to $4,000"

[1bad65]

Actually it doesn't sound like a payroll tax cut.

But honestly, the guy has NEVER voted to cut taxes. EVER. And that is a pretty big number of tax cuts he is promising. Do you really believe him?

[1bad65]

Suspend federal gas tax for summer 2008

You do know this would benefit those with lower incomes more, right?

[Water Dragon]

What part of 'EVERY TIME taxes have been cut, the government collects MORE in taxes' do you not understand? Kennedy, Reagan, and now GW Bush have all cut taxes, and the taxes collected increased.

Oh My! You are either lying between your teeth, or need to take a basic economics class. Either way, what you said is dead wrong. There are Soo many factors that go into what you said, I don't even know where to begin.

Let's start with GDP growth, as that seems to be the most common misconception. The economic health of this country has absolutely nothing to do with the President. The Fed, yes, but not the President. Tax cuts or increases have a minimal, if any effect on GDP growth. Kennedy came into office in '61. We were in the middle of both a market and economic boon at that time. That market cycle ended in 1966 and we ran a bear market until 1982, when we rode the Bull into 2000. So Reagan comes in at the end of a bear market AND a recession coupled by stagflation. Bush comes into office in 2000, suffers a 9 month recession and 2 bad years in the market, then we get a nice bear market rally mostly from the current sub-prime fiasco.

Taxes are a part of fiscal policy, the other half being spending. The purpose of Fiscal policy is to augment the formation of capital, not to stimulate growth. Monetary policy is used to stimualate growth.

How can one take these arguments seriuosly when you're not even making the right argument? Now, if you want to discuss the merits of fiscal policy and capital formation, I'm all about that, cause that's the sh!tstorm we're in right now. And if you want to talk the merits of using monetary policy to increase GDP growth which creates a larger tax base, thus providing more tax revenue even in the face of tax cuts, we can talk about that. But don't try to tell me that cutting taxes increases revenue, it doesn't. Correlation does not prove causation.

[Reality_Check]

You do know this would benefit those with lower incomes more, right?

You do know that this was pure pandering and would have benefited the oil companies, right?

http://www.taxpayer.net/search_by_ca...n&type=Project

It would also have left a $10 billion funding gap in the highway budget, which would take away from infrastructure repairs (remember the bridge collapse?). It would also mean fewer jobs.

http://money.cnn.com/2008/04/15/news..._gas/index.htm

"According to a white paper circulated on Capitol Hill last week by the U.S. Transportation Department, every $1 billion of federal highway investment supports 34,779 jobs."

http://blogs.wsj.com/washwire/2008/0...r/?mod=WSJBlog

So, with a $10 billion shortfall times 34,799 jobs = 347,790 new unemployed people.

Also, those with the lowest income drive the least.

http://www.eia.doe.gov/emeu/rtecs/nh.../table-a02.pdf

In addition, our refineries are operating close to capacity.

http://www.eia.doe.gov/pub/oil_gas/p...ining_text.htm

As the demand goes up in the summer (as people drive more), the supply can't meet it. Hence, the price goes up. If the gas tax was suspended, people would drive more, and the price would go back up. How would there be any savings?

http://taxvox.taxpolicycenter.org/bl...5/3641270.html

So, how exactly would it help them again?

[Reality_Check]

Actually it doesn't sound like a payroll tax cut.

Perhaps you're right (though I did qualify my statement as credit/cut). Regardless, I don't see a payroll tax cut from Senator McCain's plan. Do you?

[Water Dragon]

Oh, and before you start claiming I'm saying Fiscal policy is worthless, it's not. Cutting taxes creates more income which creates more demand on the part of the consumer. This can increase production which will stimulate GDP. More importantly, taxation can influence what the public spends it's money on by raising the tax on undesirable activities.

Taxation can also re-distribute wealth between not only social class, but also generations. Every time we run a defecit, what really happens is we shift the repayment of that debt to future generations. That's like running your credit cards up to $ 150,000 because you keep trying to live outside your means.

So please remember that fiscal policy involves both taxation and spending and that defecits are really nothing more that the gov't version of a credit card.

If you want a good reason to raise taxes besides fiscal responsibility, go study the effect of raising taxes on inflation, then go look at what options we still have available re: monetary policy when we have a souring economy and inflation is still just around the corner.

[BoulderDawg]

With each passing day I see the conservatives getting more and more desparate. Tonight I saw a political commercial that really hammers this home:

It was against Mark Udall (A democrat running for the senate).

The commercial:

A middle aged man dressed like a Hippy come out in front of this old VW van and starts talking about his hippy friend Mark Udall and how Udall supports all these liberal hippy ideals. Then he says "Let's go see my friend Mark." He then proceeds to open the van door which causes a big cloud of pot smoke to come drifting out......

The truth:

Udall is so conservative that most people I know (including myself)wouldn't vote for him yet the GOP is painting this man as some sort of drug crazed radical. They must really be scared to death.

[1bad65]

Oh My! You are either lying between your teeth, or need to take a basic economics class. Either way, what you said is dead wrong. There are Soo many factors that go into what you said, I don't even know where to begin.

So, your saying the tax recepts went down? Let's get a straight answer now, as CBO and IRS numbers can prove who is right.

And yet again when I point out, with evidence, that my assertions were correct, you still won't admit I was correct. First it was 'but there would have been more', now it's 'there are many other factors involved'.

Let me ask you this; Can you name JUST ONE society/country/empire that has taxed itself into prosperity?

[1bad65]

You wanna talk desperation, look at the Palin trooper bs. A big Obama supporter is behind it.

Is there an 'October surprise' brewing?

[Reality_Check]

So, your saying the tax recepts went down? Let's get a straight answer now, as CBO and IRS numbers can prove who is right.

And yet again when I point out, with evidence, that my assertions were correct, you still won't admit I was correct. First it was 'but there would have been more', now it's 'there are many other factors involved'.

Let me ask you this; Can you name JUST ONE society/country/empire that has taxed itself into prosperity?

So, the tax cut in 1981 increased revenues for President Reagan's entire term, but the tax increases in 1982 (twice), 1983, 1984, 1985, 1986 and 1987 had nothing to do with it? Peter Ferrara does not address that in the paper to which you linked. Could you address it?

Also, do you think population growth and inflation had anything to do with the revenue growth?

Finally, could you please address my question from earlier in the thread? Can you demonstrate the increase in revenues caused by a 1% cut? 5%? 10%?

[1bad65]

So, the tax cut in 1981 increased revenues for President Reagan's entire term, but the tax increases in 1982 (twice), 1983, 1984, 1985, 1986 and 1987 had nothing to do with it? Peter Ferrara does not address that in the paper to which you linked. Could you address it?

I'm referring to income taxes. They are BY FAR the largest percentage of taxes the middle class pays.

Also, do you think population growth and inflation had anything to do with the revenue growth?

Population growth? No. Inflation going down will have a positive effect. Of course Carter had it up to RECORD levels, and once Reagan's policies got it under control, it helped just like his massive tax cuts did.

Finally, could you please address my question from earlier in the thread? Can you demonstrate the increase in revenues caused by a 1% cut? 5%? 10%?

Obviously not in precise numbers, but I will say the bigger the cut the more stimulus to the economy. I personally feel we should pay NO income taxes, rather a flat 10% sales tax.

Now answer mine;

Can you name a society that has taxed itself into prosperity?

Based Obama's record of NEVER voting to cut taxes, do you believe he will give us all of these tax cuts he is promising?

[MasterKiller]

I personally feel we should pay NO income taxes, rather a flat 10% sales tax.

Are there any studies to suggest how much money the government would raise doing this in comparison to the current system?

[Reality_Check]

I'm referring to income taxes. They are BY FAR the largest percentage of taxes the middle class pays.

Actually, no (page 19, Chart 5). Would you care to address the Reagan tax increases vis a vis the increase in revenues now?

http://www.kc.frb.org/PUBLICAT/ECONR.../4q06davig.pdf

Population growth? No.

So, more people working (and paying taxes) does not increase tax revenues? Interesting...

Obviously not in precise numbers, but I will say the bigger the cut the more stimulus to the economy.

So, you can't back up your theory with actual numbers? Doesn't that mean it isn't provable?

Didn't Clinton increase taxes? And didn't revenues increase? That would seem to indicate that we are to the left on the Laffer Curve.

Add in the result of deficit spending:

"...the total amount that people will actually lend you rises with the amount you plan to borrow, until you reach a crucial point, after which it falls to zero."

This sounds like the current economic trouble in which we find ourselves.

http://www.nytimes.com/2006/01/01/bu...=1&oref=slogin

http://www.cbo.gov/ftpdoc.cfm?index=6908&type=1

[1bad65]

Are there any studies to suggest how much money the government would raise doing this in comparison to the current system?

Look at what happened to Russia's economy when they did it.