Debate Now Economics Debate: Boss vs Billy000

[Billy000]

Are you kidding me? No links? And okay sure, it's an understandable rule we wouldn't act like the copy and paste queen known as PoliticalChic but you left me no choice but to prove you wrong about tax cuts blowing up the deficit. So no, Bush's tax cuts didn't produce more revenue because by the time his term was over, the deficit was massive. A deficit that Obama successfully reduced by the way.

Here's a key piece of info you may not be aware of: The tax receipt figure is NOT the proper way to measure revenue. The receipt model is a measure of raw dollars. When measuring revenue in terms of the budget, inflation and the size of the economy has to be taken into account. it has to be computed as a percentage of the GDP. When Bush took office in 2000, revenue as a percentage of GDP was at 20%. When he left office, it was around 15%-16%.

So yeah, that graph that shows the huge increase of tax receipt over the years may seem like revenue levels are too high, but because of inflation, that graph at its peak wasn't an adequate amount to cover the nation's expenses. That's why Bush left office with a big deficit.

You didn't prove me wrong about tax cuts blowing up the deficit because I never made any claims about tax cuts relating to deficits. Deficits are the result of spending money we don't have. Tax revenues are the monies collected in taxes based on tax rates. To compare annually you do need to factor in inflation which my tables do. We're strictly looking at whether cutting the tax rates produce more or less revenue in taxes. The data shows it produces more. It doesn't matter how much we spent... that's spending, not the tax rate. It also doesn't matter how much the GDP grew. We're only looking at rate of taxation and revenue produced by it.

Now we can certainly debate spending and how running up a massive national debt with Keynesian policies is a really stupid economic plan, but that has nothing to do with the fact that more tax revenue is produced by lowering top marginal tax rates.

No, all the receipt outlay shows is raw dollars. It does not take into account the actual measurement of revenue as it relates to the budget demand. If the percentage decreases to the size of the economy, then it indicates there is shortage in covering the budget.

And yeah, Bush's 700 billion tax not only blew up the deficit and contributed to the debt, but it failed to make any stimulus into the economy. The biggest cuts went to the top earners. Obama's tax cut for the middle class was bigger than Bush's by comparison.

 

[Boss]

Are you kidding me? No links? And okay sure, it's an understandable rule we wouldn't act like the copy and paste queen known as PoliticalChic but you left me no choice but to prove you wrong about tax cuts blowing up the deficit. So no, Bush's tax cuts didn't produce more revenue because by the time his term was over, the deficit was massive. A deficit that Obama successfully reduced by the way.

Here's a key piece of info you may not be aware of: The tax receipt figure is NOT the proper way to measure revenue. The receipt model is a measure of raw dollars. When measuring revenue in terms of the budget, inflation and the size of the economy has to be taken into account. it has to be computed as a percentage of the GDP. When Bush took office in 2000, revenue as a percentage of GDP was at 20%. When he left office, it was around 15%-16%.

So yeah, that graph that shows the huge increase of tax receipt over the years may seem like revenue levels are too high, but because of inflation, that graph at its peak wasn't an adequate amount to cover the nation's expenses. That's why Bush left office with a big deficit.

You didn't prove me wrong about tax cuts blowing up the deficit because I never made any claims about tax cuts relating to deficits. Deficits are the result of spending money we don't have. Tax revenues are the monies collected in taxes based on tax rates. To compare annually you do need to factor in inflation which my tables do. We're strictly looking at whether cutting the tax rates produce more or less revenue in taxes. The data shows it produces more. It doesn't matter how much we spent... that's spending, not the tax rate. It also doesn't matter how much the GDP grew. We're only looking at rate of taxation and revenue produced by it.

Now we can certainly debate spending and how running up a massive national debt with Keynesian policies is a really stupid economic plan, but that has nothing to do with the fact that more tax revenue is produced by lowering top marginal tax rates.

No, all the receipt outlay shows is raw dollars. It does not take into account the actual measurement of revenue as it relates to the budget demand. If the percentage decreases to the size of the economy, then it indicates there is shortage in covering the budget.

And yeah, Bush's 700 billion tax not only blew up the deficit and contributed to the debt, but it failed to make any stimulus into the economy. The biggest cuts went to the top earners. Obama's tax cut for the middle class was bigger than Bush's by comparison.

Measuring revenue as it relates to budget demand doesn't have anything to do with the rate of taxation and how much revenue is produced. That's a really simple thing to measure with raw data and a calculator. Lower top marginal rates produce more tax revenue. As this would relate to any budget or debt, more revenue is always better than less. So your argument simply makes no sense.

 

[Billy000]

Are you kidding me? No links? And okay sure, it's an understandable rule we wouldn't act like the copy and paste queen known as PoliticalChic but you left me no choice but to prove you wrong about tax cuts blowing up the deficit. So no, Bush's tax cuts didn't produce more revenue because by the time his term was over, the deficit was massive. A deficit that Obama successfully reduced by the way.

Here's a key piece of info you may not be aware of: The tax receipt figure is NOT the proper way to measure revenue. The receipt model is a measure of raw dollars. When measuring revenue in terms of the budget, inflation and the size of the economy has to be taken into account. it has to be computed as a percentage of the GDP. When Bush took office in 2000, revenue as a percentage of GDP was at 20%. When he left office, it was around 15%-16%.

So yeah, that graph that shows the huge increase of tax receipt over the years may seem like revenue levels are too high, but because of inflation, that graph at its peak wasn't an adequate amount to cover the nation's expenses. That's why Bush left office with a big deficit.

You didn't prove me wrong about tax cuts blowing up the deficit because I never made any claims about tax cuts relating to deficits. Deficits are the result of spending money we don't have. Tax revenues are the monies collected in taxes based on tax rates. To compare annually you do need to factor in inflation which my tables do. We're strictly looking at whether cutting the tax rates produce more or less revenue in taxes. The data shows it produces more. It doesn't matter how much we spent... that's spending, not the tax rate. It also doesn't matter how much the GDP grew. We're only looking at rate of taxation and revenue produced by it.

Now we can certainly debate spending and how running up a massive national debt with Keynesian policies is a really stupid economic plan, but that has nothing to do with the fact that more tax revenue is produced by lowering top marginal tax rates.

No, all the receipt outlay shows is raw dollars. It does not take into account the actual measurement of revenue as it relates to the budget demand. If the percentage decreases to the size of the economy, then it indicates there is shortage in covering the budget.

And yeah, Bush's 700 billion tax not only blew up the deficit and contributed to the debt, but it failed to make any stimulus into the economy. The biggest cuts went to the top earners. Obama's tax cut for the middle class was bigger than Bush's by comparison.

Measuring revenue as it relates to budget demand doesn't have anything to do with the rate of taxation and how much revenue is produced. That's a really simple thing to measure with raw data and a calculator. Lower top marginal rates produce more tax revenue. As this would relate to any budget or debt, more revenue is always better than less. So your argument simply makes no sense.

Um it does matter if Bush left us with a deficit partially due to his 700 billion cut to revenue.

 

[Boss]

Um it does matter if Bush left us with a deficit partially due to his 700 billion cut to revenue.

When revenue is cut it does contribute to a deficit in a budget. I've already explained what happened with the Bush tax cuts. The first three years, they resulted in less tax revenue because they were not structured as the Reagan or Kennedy tax cuts.

Bush only cut top marginal rates 4.6% from 39.6% to 35%. At the same time, he cut rates to the middle class and relieved many lower-to-mid-income taxpayers from any tax liability at all. This plan was costly in terms of revenue because it was not concentrated on the top marginal wages and it didn't expand the tax base.

Still, even though his plan was stupid, it managed to increase tax revenues after 3 years and in spite of a looming recession which he had little control of. What dumb people do is cobble together all these little tid-bits of fact and proclaim tax cuts don't work. Lowering the top marginal tax rates while expanding the base results in increasing tax revenue. There is no exception in modern history.

Now, according to the Laffer Curve, there will be a point at which you can cut the top marginal rates and it will not increase tax revenue and revenue will begin to decline as you make any further cuts. Economists debate where this proverbial "sweet spot" is on the Laffer Curve. I think it's probably around 20%

Let's get back to your argument on tax rates and revenues. All you need is the raw data available from the government website, a calculator and a brain...

1980- 71% top marginal rate - yields $514 billion tax revenue.

1981- Reagan cuts top marginal rate from 71% to 28%

1988- 28% top marginal rate - yields $909 billion tax revenue.

These dollars are adjusted for inflation. How much money our government officials decided to borrow and spend, these and subsequent years, has nothing to do with this.

I actually got a chuckle out of a response from one liberal on this who charged back at me: But, you're not taking into account all the new jobs that were created and new taxpayers paying their taxes! LOL... Okay, so it wasn't the actual tax cuts that increased the tax revenue, it was all the jobs and taxpayers it created that did that! Brilliant point!