Deficit Down 8% And Improving

[BostonPirate]

This is a conversation we have had far too many times. Its getting old.

You can goof with the numbers all you like but the truth is that Bush was cooking the books. He was using cash in entitlements and replacing the cash with IOU's. that did not register into the deficit, but it had a severe impact on the debt.

Bush drove up the debt by 71 percent while in office, which is higher than any other president in the history of the nation.

Then he passed extra budgetary legislation to fund the wars, which also didn't make the deficit look higher, yet further ballooned the debt.

This is the last time I am going on this merry go round with you. You learn the republican talking points well, but the science of the politics is false.

 

[MoltenRock III]

Good God you CAN'T be serious with this tripe, can you? Bush devastated the economy? Really? Then why does every major economist credit a confluence of factors built up over a number of decades with the crisis? If you really think that Bush single handedly devastated the economy, I've got some ocean front property in Arizona to sell you.

You can't deny that 1.) Republicans constantly tout tax cuts as being the best job creators. 2.) Republicans passed the largest tax cuts in history, ever, back in 2001 and 2003 over the objections of Democrats. 3.) Only 1.1 million new jobs were created in the 8 years of Bush, Jr.'s Presidency, the worst performance in modern years.

So if tax cuts automatically create jobs, and the largest tax cuts were passed, pray tell why was job growth basically non-existent during the Bush Jr. years? Just to remind you Clinton had one of the largest tax increases in history, yet under Clinton 23 million new jobs were created, while under Bush Jr. only 1.1 million jobs were created in 8 years after a budget busting set of tax cuts. Things that make you go, "Hmmmm......."

Remember, even Jimmy Carter's administration had better job growth in just 4 years, as Bush had over 8 years. Now THAT'S tragic! Only American citizens suffer from such boneheaded economic policy the Republicans enacted.

 

[CowboyBob]

This is a conversation we have had far too many times. Its getting old.

You can goof with the numbers all you like but the truth is that Bush was cooking the books. He was using cash in entitlements and replacing the cash with IOU's. that did not register into the deficit, but it had a severe impact on the debt.

Bush drove up the debt by 71 percent while in office, which is higher than any other president in the history of the nation.

Then he passed extra budgetary legislation to fund the wars, which also didn't make the deficit look higher, yet further ballooned the debt.

This is the last time I am going on this merry go round with you. You learn the republican talking points well, but the science of the politics is false.

Excellent post.

 

[BostonPirate]

These mythical (read: nonexistent) taxes that you've somehow conjured out of your posterior and are crediting with creating the recovery have done no such thing.

the educator fireman stimulus package that was paid for with taxing businesses that ship jobs overseas? the bill the republicans hated but had to vote for?

sounding more familiar?

need a refresher?

http://www.schneiderdowns.com/Teacher_Funding_Bill

President Obama signed legislation providing funding for teachers, emergency responders and state health insurance. The House was asked to return from their summer recess to pass the Education Jobs and Medicaid Assistance Act (HR 1586) for the President’s signature. The $26.1-billion measure is partially paid for by $10 billion of international tax increases. House Ways and Means Committee Chairman Sander M. Levin, D-Mich. justified the changes to the international tax provisions that will affect many international businesses by saying, “In this bill, we close tax loopholes used by some companies to escape taxes and ship jobs overseas. Closing this loophole is fair taxation and is what the people of this country demand.”

Now you may be wondering which exact way that was done... have no fear

HR 1586 contains the following international tax revenue raisers:

• Rules to prevent foreign tax credit splitting (generally effective for taxable years beginning after December 31, 2010).
• Denial of foreign tax credits with respect to certain covered asset acquisitions (generally effective for acquisitions after December 31, 2010).
• Separate application of foreign tax credit limitation to items re-sourced under tax treaties (effective for taxable years beginning after August 10, 2010).
• Limitation on foreign tax deemed paid with respect to Section 956 inclusions (effective for acquisitions of U.S. Property after December 31, 2010).
• Certain redemptions by foreign subsidiaries (effective for acquisitions after August 10, 2010)
• Modification of affiliation rules for interest expense allocation purposes (effective for taxable years beginning after August 10, 2010).
• Repeal of the “80/20” rules (effective for taxable years beginning after December 31, 2010).

As you might expect, each of the new international tax provisions noted above are very complex in nature and will have application only to those conducting international business operations.

I can see how that may have slipped your mind. It was a very complex and creative piece of legislation that actually pushed companies to buy american and sell abroad.

you may note that this WORKED and the trade deficit dropped sharply shortly thereafter.....

The United States trade deficit narrowed by 14 percent in July as exports by American companies rose by about $2.8 billion, suggesting that trade would be less of a drag on growth in the months ahead.

Commerce Department figures showed that exports totaled $153.3 billion in July, up from $150.6 billion in June. A $2.3 billion increase in capital goods, most of it civilian aircraft, accounted for the bulk of the export increase. Industrial supplies and materials, and food and beverages also rose.

The trade deficit narrowed to $42.8 billion, down from a revised $49.8 billion in June, the department said. Imports totaled $196.1 billion in July, $4.2 billion less than June. Much of the decline, $1.9 billion, came from lower imports of consumer goods.

http://www.nytimes.com/2010/09/10/business/economy/10econ.html

so you see....

Raising taxes reduced the deficit, the debt and the unemployment rate.

raising taxes to pay for the stimulus package to hire people who pay income tax, while it raised revenue through taxation of companies that hire and ship jobs out of the country, which lowered the trade deficit and also created new jobs.

and we see the deficit dropping by 8 to 10 percent.

are we all clear now????

 

[rareboy]

i just find it funny how you gay people defend the guy, when he has promised to address gay rights concerns, but he hasnt even mentioned them. im surprised you gay people don't vote independent.

So, stevexxx, I was going to ask how much does the GOP pay an op to hang out in a gay political forum these days anyway?

Or whether you are just Laika, having to do this for your unpaid internship?

And then I read the rest of your 25 posts, in threads like Father/Son incest etc., etc.

So now I'm just left thinking WTF?

I've looked at the syntax and spelling and content and I have to say that I'm completely mystified.

 

[SuperPsyze]

The thing is that simply giving this cash to the big corporations through a tax cut will allow them to create more jobs. The problem is that nothing is entitling them to keep these jobs in the US. I mean, if you saved $40,000 in tax cuts, are you going to hire 1 US worker or 2 overseas workers?

What I think should happen is that these large corporations should not get their large tax cuts. Instead, they can file claims based on how many US employees they have and receive incentives for hiring domestically. There should be a balance of control between the government and the corporations. It has become clear that the corporations have no interest in the US economy as long as they can profit.

 

[JB3]

This is a conversation we have had far too many times. Its getting old.

You can goof with the numbers all you like but the truth is that Bush was cooking the books. He was using cash in entitlements and replacing the cash with IOU's. that did not register into the deficit, but it had a severe impact on the debt.

Bush drove up the debt by 71 percent while in office, which is higher than any other president in the history of the nation.

Then he passed extra budgetary legislation to fund the wars, which also didn't make the deficit look higher, yet further ballooned the debt.

This is the last time I am going on this merry go round with you. You learn the republican talking points well, but the science of the politics is false.

And yet you still persist in your profound ignorance. Fine, believe Bush was solely responsible for the economic collapse. History shows otherwise. It wouldn't be the first time someone of your stripes decided to rewrite history for their own benefit.

 

[JB3]

You can't deny that 1.) Republicans constantly tout tax cuts as being the best job creators. 2.) Republicans passed the largest tax cuts in history, ever, back in 2001 and 2003 over the objections of Democrats. 3.) Only 1.1 million new jobs were created in the 8 years of Bush, Jr.'s Presidency, the worst performance in modern years.

So if tax cuts automatically create jobs, and the largest tax cuts were passed, pray tell why was job growth basically non-existent during the Bush Jr. years? Just to remind you Clinton had one of the largest tax increases in history, yet under Clinton 23 million new jobs were created, while under Bush Jr. only 1.1 million jobs were created in 8 years after a budget busting set of tax cuts. Things that make you go, "Hmmmm......."

Remember, even Jimmy Carter's administration had better job growth in just 4 years, as Bush had over 8 years. Now THAT'S tragic! Only American citizens suffer from such boneheaded economic policy the Republicans enacted.

We've been through Clinton's job record before. (a series of posts that you conveniently ignored) Clinton was not responsible for the job growth. He and his advisors took credit for it then, but admitted that the policies they recommended (and that Clinton enacted) had little to do with the growth.

THAT being said however, Bush's job growth was pitiful. I don't agree with your contention about tax cuts, though. As with the economic crisis, the lack of job growth under Bush can be attributed to mistakes that he made, as well as events that occurred prior to him even taking office. Those things combined to negate any positive aspects of the tax cuts, and in fact hastened the arrival of the economic crisis.

 

[Kulindahr]

In Obama's first fiscal year, which we are in the final month of as the federal fiscal year runs from Oct. 1st - Sept. 30th. In Bush's final fiscal year the deficit totaled a bit over $1.4 TRILLION. As of now, the first Obama budget will come in at 8% less than Bush's last one, at $1.3 TRILLION. However, over the past few months the deficits have been consistently smaller than predicted. So once the tallies are totaled my guess is that the deficit will be down 10% total, down to a total of $ 1.25 TRILLION. (Yes, that's still awful, but it's a much better improvement than Bush's final budget.

Additionally, taxes are set to go up under Bush's budget come January 1, 2011. Obama and the Democrats want to recut those taxes back down except on the portion of the income over $250,000 a person makes. Every American would get a tax cut, but only those making more than $250,000 would pay a little bit more on the portion of their incomes that are over the $250,000 mark.

http://www.marketwatch.com/story/us...cit-in-august-2010-09-13?reflink=MW_news_stmp

O and the Ds are far too timid. They should let the $250k level go back to pre-Bush, but draw a line at $325k to start the pre-Reagan rate, and another at $500k to go ten percent higher yet. When income passes $650k, run it up to WW II rates.

That ought to drop the deficit by a good 30%+ next year.


BTW, at an 8% per year rate, the progression would go 92, 84.6, 77.3, 71, 65.8, 60.1, etc. taking nine years to cut the deficit in half. By then the debt would be over 8 trillion higher -- and that's not acceptable, which is why I say the Democrats in D.C are far too timid.

 

[Kulindahr]

HA....

I predicted this a month ago and the republicans threw a gasket calling me crazy, they all said I was nuts etc... well what do you know... and it isn't even october yet when, BTW, it will improve even more.
. . . .

They will just continue the lies that their party is spreading.

The next few months are, if I understand how they do such things, already part of the figure, via projection.

Kinda like you -- except you pretty much limit yourself to just the one, while they devise new ones as a hobby.

But most importantly, as I've said all along, the deficit cannot be fixed at all until we get American citizens back to work. Period! We need to get job growth going at all costs, so that Joe American Citizen will stop needing to collect unemployment and start paying taxes again for Social Security and income taxes. Having 15+ million unemployed people requiring federal money to stay afloat vs. those 15 million unemployed workers finding jobs and paying taxes is ENORMOUS!

Yep. If 10% of people aren't working, getting them working again ought to increase revenues enough to add a couple of percentage points to that decrease. And as anyone who's had a loan knows, just a few percentage points add up.

But it's still not enough.

 

[MoltenRock III]

O and the Ds are far too timid. They should let the $250k level go back to pre-Bush, but draw a line at $325k to start the pre-Reagan rate, and another at $500k to go ten percent higher yet. When income passes $650k, run it up to WW II rates.

That ought to drop the deficit by a good 30%+ next year.


BTW, at an 8% per year rate, the progression would go 92, 84.6, 77.3, 71, 65.8, 60.1, etc. taking nine years to cut the deficit in half. By then the debt would be over 8 trillion higher -- and that's not acceptable, which is why I say the Democrats in D.C are far too timid.

The thing is when the tax rates were 70%+ under Reagan tax shelters were rife. Once the final streamlining of the tax code was finished under HW Bush, Sr., and Clinton, tax shelters dropped to almost nil, and tax compliance was at an all time high. It's a balancing act of maximizing revenue while not discouraging compliance, tax shelters, and disincentive to work / make additional salary.

 

[Kulindahr]

haha molten and you think that is going to last. you honestly think that obama is any better than bush? ha first of all the economy sucks and its going to take a double dip, which will result in obama spending more to temporarily fix the economy. he wants to create a new infrastructure plan to help rebuild our sewers streets, and highways. that is an estimated 3 trillion he would need to spend. BUT with obama you dont know what you would get out of him. i have seen nothing he has done to fix the economy besides spend. he has not fulfilled any of his promises. he lied to the minorities, especially to the latino community telling them he would get them amnesty for illegal latinos. and promised countless other things. but he never has done what he promised besides the leaving from middle east, but people are still there. i just find it funny how you gay people defend the guy, when he has promised to address gay rights concerns, but he hasnt even mentioned them. im surprised you gay people don't vote independent.

Japan's example (and China's, BTW) showed that putting infrastructure into superb shape will aid strongly in turning around a deficit (whereas spending on non-infrastructure is like band-aids that fall off the moment you stop looking). It may take a while for major payoffs, but some of the stimulus infrastructure projects are already paying off in small ways -- yet small ways start snowballing.

Here's a stimulus infrastructure project (that Swerve ought to appreciate) which would be a serious kick: pick an interstate with heavy traffic that runs east-west, and fix everything on it, even adding lanes where useful (I'd start with I20 or I30). Then take the north-south ones on either end of the country and do the same then. Once those are A++, take another east-west, and do it. It wouldn't be perfect, but it would provide a basic grid of excellent transportation.

 

[Kulindahr]

economically there is NO difference between an expense increase and a revenue decrease.

they BOTH produce the exact same effect on the bottom line. The republican lie is that lowering taxes increases revenue.

NO

it just doesn't

You can cook the books to make it look that way, but if the IRS ever had to audit the US budget, people would be going to jail for shady accounting practices.

Today's Republicans learned the same wrong lesson from Reagan's favorite curve that they did from his deficit spending: that it always has good results.

Reagan's deficits were for a good cause; today's Republicans think that all deficits must be good (unless they're Obama's deficits). And the Laffer curve is valid only under special conditions, which Reagan actually had. Both are like the case of Newtonian physics being valid within the Solar System: they work in that small range, but once you leave that range you need different rules.

We are nowhere near where the Laffer curve works (for starters, it requires near-full employment), and we have no good reason for deficits. IMO, if we had Reagan back he'd give them the equivalent of a good swift kick to the rear for being idiots... and probably another a month later, and another....

You're right about shady accounting practices; Johnson started our biggest one, and it's been getting worse ever since.


edit: actually economically there can be a HUGE difference between a spending decrease and a revenue increase; it matters how they're targeted. Where they aren't different is in budget terms.

 

[Kulindahr]

Uh, no. The economy is recovering because that's what happens in a recovery. It would have happened with Obama in office, it would have happened with McCain in office. These mythical (read: nonexistent) taxes that you've somehow conjured out of your posterior and are crediting with creating the recovery have done no such thing.

The big difference is that McCain doesn't give a shit about anything except stifling the Bill of Rights and getting re-elected, while Obama cares about half and half between the country and pacifying the big corporations. So when you say that there would have been no difference under McCain, I have to laugh: there wouldn't have been one single program to help people get back on there feet or benefit anyone at all except the D.C. power elite and the corporations that keep them in their comfort.

The thing is when the tax rates were 70%+ under Reagan tax shelters were rife. Once the final streamlining of the tax code was finished under HW Bush, Sr., and Clinton, tax shelters dropped to almost nil, and tax compliance was at an all time high. It's a balancing act of maximizing revenue while not discouraging compliance, tax shelters, and disincentive to work / make additional salary.

For people making over $300k, I don't give a shit what motivates them and what doesn't, and for those making over half a million I care even less. IMO the debt crisis is the worst thing the U.S. had faced since WW II, and it needs to be tackled with the same determination -- and that means rapacious and confiscatory taxes until we get the entire debt down below a single trillion.

Just taking the money we waste on debt interest every year, do you realize what could be done for infrastructure, stimulating small entrepreneurs, and boosting research? And that money would stay in the economy, going 'round and 'round generating more prosperity.

 

[Kulindahr]

^ Agreed on all points, Kulindahr.

@MoltenRock: yeah, the nominal tax rates were 75%+ up until Reagan, and yes, there were tax shelters....

....but before Reagan the Republicans had brains. It was a Republican who implemented the Alternative Minimum Tax, in which even the shadiest tax shelterer had to pay 21% of his income.

Moreover, those tax shelters often really did spur the economy. (How many 70s houses do you see? They're ubiquitous!)

A quick look at our deficits/surpluses in the 60s and 70s will shock you.

21% isn't bad.

But it really should, especially these days, be done as a "Fair Aleternative Minimum Tax", and that 21 should be, oh, on the order of 2/3.

I know just how many 70s houses there are, and as someone who has done repairs in far too many of them, I can make a couple of comments: first, they needed upgraded as far as today's technological/electrical needs, and second, they are still a better deal for decent housing than anything built in the last two decades. Back then, when they built "affordable housing", it meant affordable to ordinary people without dragging them near the precipice, not affordable to upper middle class by putting their balls and the blood of their firstborn on the line.

 

[White Eagle]

Please be SPECIFIC with what EXACTLY is included in the bill currently, as well as a cite, if you would please. Thank you in advance.

Did fasteddy get lost somewhere? I wanted to see those cites. I guess he fell through the crack.