Job Killing Taxes

[Rshermr]

That 30 year period after Reagan's tax cuts...no growth there

After JFK's tax cuts...economic decline???

My goodness this one is ignorant!

Well, eflat, another stupid tea bagger to be educated. You could at least post something that had some real meaning. but this is embarrassing, eflat..

Reagan: Speaking of ignorant, were you aware that within 12 months after the great reagan tax decrease, unemployment had gone upward from 7% to over 10.5%? Bet your educators forgot to fill you in on this one.
And did they also fail to tell you, that in response to unemployment and the spiraling national debt that resulted from his great tax decrease, Reagan increased taxes 11 times?
And, did they also fail to mention that the great tax decrease caused Reagan to borrow more money than all of the presidents up till his time COMBINED? He tripled the national debt.

So, eflat, it appears to me that calling someone other than yourself ignorant is really a stupid thing to do.

JFK? JFK decreased taxes in GOOD economic times. That has been done before. It was not to provide an economic stimulus. By the way, eflat, I am NOT against tax decreases. I just happen to not be among those ignorant souls who are ignorant enough to believe that a tax decrease to the wealthy is a stimulus of any kind.

Reagan: Speaking of ignorant, were you aware that within 12 months after the great reagan tax decrease, unemployment had gone upward from 7% to over 10.5%?

What happened to interest rates over that 12 months?
What happened to unemployment 24 months later? 36? 48?

And, did they also fail to mention that the great tax decrease caused Reagan to borrow more money

Really? Tax receipts decreased? I'm pretty sure income tax receipts went from $286 billion in 1981 to $445 billion in 1989. While the top rate went from 70% to 28%.

Well, Toddster, lets look at your statements:

What happened to interest rates over that 12 months?
What happened to unemployment 24 months later? 36? 48?
Interest rates were one of the great advantages that reagan had. They were very high, set that way to fight inflation by the Fed. When the economy changed to less inflationary, the Fed took the rates downward to more normal rates.

Relative to unemployment, rates began to fall AFTER reagan began to borrow like crazy and spend like a drunk sailor. Remember, the national debt tripled during his presidency, and he spent it on STIMULATIVE projects. And, of course, he increased taxes several times (11 during his terms, to be exact) again decreasing unemployment. That is your problem, you do not follow the timeline of what happened. Simply taking a starting point and then moving forward to some point at which things were better, is totally lacking in integrity. You could go forward to 1999, and take in the 92 through 99 economies, giving reagan credit for that also if you really want to be disingenuous.

Really? Tax receipts decreased? I'm pretty sure income tax receipts went from $286 billion in 1981 to $445 billion in 1989. While the top rate went from 70% to 28%.

Revenue grew for a number of reasons. See above, in my first part of this post. But also because of population growth and inflation. From 1979 to 1991, revenue per capita grew only 1,8%. Pretty poor. But more importantly, I was talking about the period 1981 through 1983, when receipts fell. Again, it is very easy to lie with numbers if you pick your dates and data carefully. But I was only talking about what made reagans people determine that he needed to borrow and spend, and increase taxes and spend.
Again, a little honesty is valuable.

So, here is a question for you. Why, if the tax decreases were as successful as you seem to think, did he borrow to the point that he had tripled the national debt by the end of his term???
And why did he raise taxes 11 times, effectively negating about half of his original large tax decrease???

 

[Widdekind]

Back in the 1950s, when the top marginal tax rate was more than 90 percent, real annual growth averaged more than 4 percent.

no, that is misleading. Back in the 1950s, the US economy was small. And, small economies can, and do, grow quickly. Today, the US economy is huge. And, huge economies cannot grow at the same relative rates. Economic growth, in relative (%) terms, always slows, as economies become bigger. In analogy, animals grow fast when they're young, and more slowly when they're older & bigger.

Those statistics are misleading -- the US had high marginal tax rates, decades ago, when the economy was small and blossoming. And, the US has had lower marginal tax rates, recently, when the economy was the biggest on earth. If you plot the same data, in absolute terms (average year-to-year growth in real GDP, absolute dollar figure); then you see, that higher taxes co-occurred with lower (absolute) real growth:

 

[Toddsterpatriot]

Well, eflat, another stupid tea bagger to be educated. You could at least post something that had some real meaning. but this is embarrassing, eflat..

Reagan: Speaking of ignorant, were you aware that within 12 months after the great reagan tax decrease, unemployment had gone upward from 7% to over 10.5%? Bet your educators forgot to fill you in on this one.
And did they also fail to tell you, that in response to unemployment and the spiraling national debt that resulted from his great tax decrease, Reagan increased taxes 11 times?
And, did they also fail to mention that the great tax decrease caused Reagan to borrow more money than all of the presidents up till his time COMBINED? He tripled the national debt.

So, eflat, it appears to me that calling someone other than yourself ignorant is really a stupid thing to do.

JFK? JFK decreased taxes in GOOD economic times. That has been done before. It was not to provide an economic stimulus. By the way, eflat, I am NOT against tax decreases. I just happen to not be among those ignorant souls who are ignorant enough to believe that a tax decrease to the wealthy is a stimulus of any kind.

Reagan: Speaking of ignorant, were you aware that within 12 months after the great reagan tax decrease, unemployment had gone upward from 7% to over 10.5%?

What happened to interest rates over that 12 months?
What happened to unemployment 24 months later? 36? 48?

And, did they also fail to mention that the great tax decrease caused Reagan to borrow more money

Really? Tax receipts decreased? I'm pretty sure income tax receipts went from $286 billion in 1981 to $445 billion in 1989. While the top rate went from 70% to 28%.

Well, Toddster, lets look at your statements:

What happened to interest rates over that 12 months?
What happened to unemployment 24 months later? 36? 48?
Interest rates were one of the great advantages that reagan had. They were very high, set that way to fight inflation by the Fed. When the economy changed to less inflationary, the Fed took the rates downward to more normal rates.

Relative to unemployment, rates began to fall AFTER reagan began to borrow like crazy and spend like a drunk sailor. Remember, the national debt tripled during his presidency, and he spent it on STIMULATIVE projects. And, of course, he increased taxes several times (11 during his terms, to be exact) again decreasing unemployment. That is your problem, you do not follow the timeline of what happened. Simply taking a starting point and then moving forward to some point at which things were better, is totally lacking in integrity. You could go forward to 1999, and take in the 92 through 99 economies, giving reagan credit for that also if you really want to be disingenuous.

Really? Tax receipts decreased? I'm pretty sure income tax receipts went from $286 billion in 1981 to $445 billion in 1989. While the top rate went from 70% to 28%.

Revenue grew for a number of reasons. See above, in my first part of this post. But also because of population growth and inflation. From 1979 to 1991, revenue per capita grew only 1,8%. Pretty poor. But more importantly, I was talking about the period 1981 through 1983, when receipts fell. Again, it is very easy to lie with numbers if you pick your dates and data carefully. But I was only talking about what made reagans people determine that he needed to borrow and spend, and increase taxes and spend.
Again, a little honesty is valuable.

So, here is a question for you. Why, if the tax decreases were as successful as you seem to think, did he borrow to the point that he had tripled the national debt by the end of his term???
And why did he raise taxes 11 times, effectively negating about half of his original large tax decrease???

And, of course, he increased taxes several times (11 during his terms, to be exact) again decreasing unemployment.

But of course cutting rates from 70% to 28% should have caused unemployment to skyrocket, if your moronic economic theory worked.

That is your problem, you do not follow the timeline of what happened.

But I do follow the timeline. Which is why I laughed at your claim that his tax cuts caused the rise in unemployment over the next 12 months.

Revenue grew for a number of reasons.

But you said "the spiraling national debt that resulted from his great tax decrease".
I guess you were mistaken. Again.

From 1979 to 1991, revenue per capita grew only 1,8%.

Grew after the top rate was cut 60%? Cool!

But more importantly, I was talking about the period 1981 through 1983, when receipts fell.

But more importantly, you're ignoring the deep recession caused by the massive hike in interest rates. Unless you didn't follow the timeline?

And why did he raise taxes 11 times, effectively negating about half of his original large tax decrease?

He listened to the Democrats in Congress who said they'd cut spending several dollars for each dollar of increased taxes. They never did cut the spending. That's why the Tea Party now is only interested in spending cuts. We've learned you democrats will never keep your promises.

 

[Widdekind]

average absolute annual growth, of real GDP per capita (2005 USD per person), increased, with decreasing marginal tax rates. Tax-cuts in 1964 and 1981 correlate with large increases in growth. The 1986 tax-cuts, which reduced maximum rates from 50% to 30%, correlate with modest but positive growth gains (reduced by the 2008 recession).

Since the 1980s, total taxation in the US has been about a third of GDP, i.e. on average, about a third of the price of every new final good & service sold in the US every year winds up taken as tax. Progressive taxes make high-income earners pay more than an equal share in tax, relative to income, by about 10% of all taxes taken. Thus, progressive taxes increase the total tax burden on US citizens by 10%; and that tax burden (ultimately) accounts for a third of final prices. Ergo, on average, progressive taxes cost US consumers over 3 cents on every dollar spent. Equitable taxes would reduce final prices by several percent, since lower taxes mean workers accept lower salaries (even as higher taxes mean they demand higher salaries). Please recall, US citizens tax themselves over thirty percent; all those taxes add up, making US products pricey, and uncompetitive against foreign competition. Reducing taxes could cut costs, and prices, and reduce the US trade deficit.

How much taxes are paid by the poor, middle class and rich

http://cbo.gov/sites/default/files/cbofiles/ftpdocs/88xx/doc8885/12-11-historicaltaxrates.pdf​

 

[OohPooPahDoo]

...the central tenet of modern conservative economics is that a lower top marginal tax rate will result in more growth, and these numbers do show conclusively that history has not been kind to that theory...

...That won't get you anywhere with the right wing...

Agreed, because the central tenet of modern conservative economics is that a lower top marginal tax rate occurs with more economic activity, and that's what the record does in fact show...

Wow, look, the population grew. Must have been caused by lower tax rates.

 

[Widdekind]

We're trying to see what taxes do to real GDP. Fine all we do is plot tax rates with real GDP...and anyone can see that high taxes mean low GDP and low taxes make for high GDP.

to highlight the effect of taxes "on that other guy", to personal income, you could plot tax-rates vs. real GDP per capita:

the message is more-or-less the same, average income per person has increased steadily over the decades.

Note, however, that average income per household has stagnated since the 1970s. If you divide (income per household) by (income per person), you get (persons per household). In the early 1970s, that was about two ("married filing jointly"); today, about one ("single", "married filing separately"). Thus, "middle America" has stagnated for 40 years; single-income households, then, earned as much (in real terms) as double-income households today. The difference is women entering the workforce, after the 1960s. Yet, those "stagnated" standards of living are still the highest on earth. In aviation analogy, average US incomes have "reached cruising altitude".

Average Income in the United States​

 

[OohPooPahDoo]

Correlation does not imply causation. ...

Sure it does, but Star failed to show either.

We're trying to see what taxes do to real GDP. Fine all we do is plot tax rates with real GDP--

--and anyone can see that high taxes mean low GDP and low taxes make for high GDP.

The two curves look nothing alike.

 

[itfitzme]

to highlight the effect of taxes "on that other guy", to personal income, you could plot tax-rates vs. real GDP per capita:

the message is more-or-less the same, average income per person has increased steadily over the decades.

Irrespective of tax changes, the major reason for GDP increase has been because of efficiency increases.

 

[EdwardBaiamonte]

Irrespective of tax changes, the major reason for GDP increase has been because of efficiency increases.

that of course is silly since there is nothing to be efficient about until you have a basic stream of innovations. GDP from the stone age to here came from all the innovations, making them more efficient was a secondary process. Efficiency alone is quite meaningless.

 

[EdwardBaiamonte]

Note, however, that average income per household has stagnated since the 1970s.

that of course is the brainwashed liberal POV:

You don't need to be an economist to see how rich the middle class got by looking at all the new inventions they could suddenly afford in the just the last 15 years: suddenly we had plasma TV's, LCD TV's, DLP-TV's, iPods, iphones, CD's and CD players, DVDs and DVD players, Blue Ray and Blue Ray players, PCs, desk top PCs, DVRs, color printers, satellite radio, Advantium ovens, HD-TV, Playstations, X-Boxes, X-box live, X-box Konnect, broadband, satellite TV, cell/camera/video phones, digital cameras, OnStar, palm corders, Blackberries, smart phones, home theaters, SUVs, big houses, more houses per capita, TiVo, 3D movies and TV's, built in wine coolers, granite counter tops, $200 sneakers, color matched front loader washing machines, matching washer dryer combinations, McMansions, 6 burner commercial ranges, Sub Zero refridgerators, more cars than drivers, a $1 billion ring tone industry, a pet industry that just doubled to $34 billion, 10's of millions lining up to buy Apple's I-tablet, Wii, Netflix boxes, jet skis, low profile tires, aluminum/titanium rims, Harley Davidson and Japanese motorcycles. $700 Billion spent Christmas 2010, $10.5 billion movies 2010, 10 million ocean crusies, 44 million taking plane flights over 2012 holiday, $500 billion spent on Christmas 2012.

The list goes on and on. I hope that helps you realize you can't just parrot the communist press and expect to make sense? They have other objectives and are merely using you to promote their point of view.

 

[expat_panama]

...average income per household has stagnated since the 1970...

No it hasn't, it's doubled. Here are the numbers:

 

[expat_panama]

Correlation does not imply causation. ...

Sure it does, but Star failed to show either. We're trying to see what taxes do to real GDP. Fine all we do is plot tax rates with real GDP--

--and anyone can see that high taxes mean low GDP and low taxes make for high GDP.

The two curves look nothing alike.

Which two curves?

 

[Widdekind]

...average income per household has stagnated since the 1970...

No it hasn't, it's doubled. Here are the numbers:

the simplest-and-plainest statistics -- real GDP per capita, and real GDP per worker -- have both about doubled, since 1970, as you say. What is the following figure plotting ??

Average Income in the United States​

 

[expat_panama]

...average income per household has stagnated since the 1970...

No it hasn't, it's doubled. Here are the numbers:

the simplest-and-plainest statistics -- real GDP per capita, and real GDP per worker -- have both about doubled, since 1970, as you say...

In the first place, we're talking about income and not GDP. In the second place, what I say doesn't matter any more than what you say. Instead of thing's being said, we want to focus on what is, and in this case we're looking at the BEA's real disposable personal income and dividing it by the Census Br.'s household count.



GDP is different. We together yet?

 

[Widdekind]

No it hasn't, it's doubled. Here are the numbers:

the simplest-and-plainest statistics -- real GDP per capita, and real GDP per worker -- have both about doubled, since 1970, as you say...

In the first place, we're talking about income and not GDP. In the second place, what I say doesn't matter any more than what you say. Instead of thing's being said, we want to focus on what is, and in this case we're looking at the BEA's real disposable personal income and dividing it by the Census Br.'s household count.



GDP is different. We together yet?

i do not understand the plot on the webpage i cited (Visualizing Economics). From the FRED online data grapher, whether you consider (GDP, Personal Income, Personal Disposable Income, Wages) per (population, worker), i.e. you can mix and match any of those; in all cases & combinations, dollars per person has steadily increased, without any indication of "stagnation since the 1970s" as the afore-cited chart seems to say.

the US "middle class" is not destitute; is not living under bridges; is not starving & hungry. There is always "greener grass" somewhere; "complaining" about OPM and "only making $30K / year" is not legitimate, on a world where millions of people everyplace else actually are destitute, homeless, hungry & starving.

 

[Rshermr]

Note, however, that average income per household has stagnated since the 1970s.

that of course is the brainwashed liberal POV:

You don't need to be an economist to see how rich the middle class got by looking at all the new inventions they could suddenly afford in the just the last 15 years: suddenly we had plasma TV's, LCD TV's, DLP-TV's, iPods, iphones, CD's and CD players, DVDs and DVD players, Blue Ray and Blue Ray players, PCs, desk top PCs, DVRs, color printers, satellite radio, Advantium ovens, HD-TV, Playstations, X-Boxes, X-box live, X-box Konnect, broadband, satellite TV, cell/camera/video phones, digital cameras, OnStar, palm corders, Blackberries, smart phones, home theaters, SUVs, big houses, more houses per capita, TiVo, 3D movies and TV's, built in wine coolers, granite counter tops, $200 sneakers, color matched front loader washing machines, matching washer dryer combinations, McMansions, 6 burner commercial ranges, Sub Zero refridgerators, more cars than drivers, a $1 billion ring tone industry, a pet industry that just doubled to $34 billion, 10's of millions lining up to buy Apple's I-tablet, Wii, Netflix boxes, jet skis, low profile tires, aluminum/titanium rims, Harley Davidson and Japanese motorcycles. $700 Billion spent Christmas 2010, $10.5 billion movies 2010, 10 million ocean crusies, 44 million taking plane flights over 2012 holiday, $500 billion spent on Christmas 2012.

The list goes on and on. I hope that helps you realize you can't just parrot the communist press and expect to make sense? They have other objectives and are merely using you to promote their point of view.

Ed,
I am sure you will not understand this, but:
Top 1% earnings went up 275% over past 30 or so years.
During the same period, the middle class earnings went up 17%.
That's what people have to buy all those wonderful things you are talking about.
Now, do you see any problem???

I didn't think so.

 

[expat_panama]

...i do not understand the plot on the webpage i cited (Visualizing Economics)...

Visualizing Economics is a left wing site that's run like the founder's consulting firm --it processes econ data as needed to support political activities. Don't get me wrong, we need that service and I'm happy for them. We just have to remember that if we want econ data processed to tell us what's actually going on then we need to go elsewhere, like the Federal Reserve Data site, the BLS, the BEA interactive data, etc.