Our economic mess, the direct result of...

[BaronVonBigmeat]

Yeah, and that's different now?

No, certainly not. It's irrelevant, it doesn't represent reality.

So why do you keep bringing it up?

On the one hand, you seem to think that it was a part of the american worker's better status in decades past; but then you concede my point, which is that the rate was never truly 90% to begin with. I'm honestly not even sure what you're trying to say here.

Apparently, you didn't know that taxes are not levied on "wealth" but on income.

No, I understand that part. That's part of my point. The whole point of high income taxes is to soak the rich. But of course you're really not soaking them at all, their wealth is in assets, exactly as you said. Even if you had a true 90% rate without loopholes, you're not soaking them. You might be soaking some guy who's trying to expand his small business without taking on excessive debt though.

That's why I mentioned the Rockefellers and Fords. You seem to be nostalgic for a mythic age when the rich were heavily burdened for the good of the worker. But the income tax was always full of loopholes, and the rich are rich due to their stock and real estate holdings and so forth anyway.

 

[BaronVonBigmeat]

The pattern that you have noticed is that recent Republican administrations, even though calling themselves "Conservative" have been the exact opposite when looking at fiscal policy.

Nothing conservative about Reagan, Bush or Dubya. They all were eager spenders. Dubya spent money like it was free, and doubled our national debt.

I made some satirical posts on other boards about that, and some of the free spenders thought that I was serious, so I decided to refrain from any further satire.

Satire is supposedly the highest form of humor. Slapstick is the lowest. Satire is only funny when people know it is satire. If they take you seriously, you might be in trouble.


In satire, irony is "militant." This "militant" irony [or sarcasm] often professes to validate the exact thing the satirist actually wishes to attack.

I found a nifty blog by this guy Howard Katz the other day. He had an interesting insight regarding this.

In a previous blog, I pointed out that, if we study American Presidents from Lyndon Johnson to George Bush, Jr. from the point of view of the promises they (or their party) made in their election campaigns, we find that the President does a better job of fulfilling the campaign promises of his opponents than his own. I am here talking about those issues on which the parties disagree, which played the biggest role in the election campaign and am viewing the promises in the way they were viewed by the electorate of the day.

Lyndon Johnson (1964) fulfilled (what he viewed as) Barry Goldwater’s promise to stand up to the Communists in Vietnam, not his own promise to give us peace in that region. In his first term (1968), Richard Nixon promised a balanced budget and a free economy, specifically no price and wage controls. He was understood to be the anti-communist candidate, which at the time implied intense hostility toward Communist China. He violated all of these promises. In his second term (1972), there was one major issue. George McGovern ran on the platform of unilateral withdrawal from Vietnam, meaning the withdrawal of U.S. troops within 90 days of the new President taking office (in Jan. 1973) provided that we got our POWs back. Nixon opposed unilateral withdrawal with a program he called peace with honor. By this he meant that there should be no withdrawal from Vietnam unless the existence of an independent, non-communist South Vietnam was guaranteed. Nixon won by a large majority. He immediately (within 90 days) withdrew U.S. troops. The independent non-communist South Vietnam was destroyed shortly thereafter and has not existed to this day.

In 1980, Ronald Reagan ran as a conservative, meaning that he opposed FDR’s New Deal. He promised to follow Milton Friedman’s monetary rule, meaning that the money supply would not grow by more than 2%-6% in any one year. And he promised never to negotiate with terrorists. He immediately adopted FDR’s Keynesian program (budget deficits financed by the printing of money). His 8 years as President averaged 8% growth in the money supply with peak years of 12% in 1985 and 17% in 1986. Not only did he negotiate with terrorists ((Iran-Contra) he gave in to them and sold them the arms they desired.

George Bush, Sr. turned the 1988 election into a one-issue campaign. He claimed that the Democrats would come to him asking for higher taxes, and he would turn them down. He said this at every opportunity and used a phrase which became famous. “READ MY LIPS; NO NEW TAXES.” Lo and behold, the Democratic leadership did come to him demanding a tax increase in the exact scenario he had described. He capitulated without a fight and enacted the tax increase.

In 1992, Bill Clinton ran as a typical New Deal Democrat implying a steady growth in the size of the government, a continual budget deficit and a defense of the existing system of welfare. He particularly described himself as “the woman’s candidate” meaning that he would support feminist issues. Upon election he said, “The era of big government is over.” He reduced the size of the government (whether measured by government spending as a percent of GDP or by non-military government employees and he balanced the budget (as normally understood). He ended “welfare as we know it” sharply reducing the existing welfare program. At the same time, he treated women as mere sex objects and was involved in a number of disgraceful episodes with women which resulted in his impeachment by the House of Representatives.

In 2000, George Bush, Jr. ran as a “compassionate conservative” with “compassionate” suggesting big government and “conservative” suggesting small government. This was generally understood to mean that he would be a conservative but not a radical one. He has introduced socialism into the American economy (a government ownership stake in the banks) and is currently engaged in a massive printing of money.

...


Once a President is elected, he is immediately facing reelection. To lose on his second term is a disgrace. He will go down in the history books as a “one-term President.” He is desperate for votes. At the same time, there is a large minority who hate him. LBJ, Nixon, Reagan, Clinton understood that most of one’s supporters are so focused on the personality of the man, as opposed to the merit of the issue, that if one betrays one’s supporters, they will overlook it. One can therefore mollify one’s opponents without driving away most of one’s supporters. Two outstanding examples are Nixon’s opening to China and Clinton’s cutback of welfare.

The conservatives of the 1950s and ‘60s were often called the China Lobby. This meant that they hated Communist China and loved Nationalist China (Formosa/Taiwan). To extend diplomatic recognition to Communist China was anathema to them. Nixon was their hero. His campaign for the Senate in 1950 had established him as a dedicated anti-communist. He was included on Eisenhower’s ticket in 1952 precisely to win conservatives support (money and energy). He would never, ever cozy up to the hated Chinese Communists. And then when he did just that, the conservatives played mental tricks. “This is a brilliant strategic move to split the Communist world. It is not what it appears on the surface.” Had a Democrat done the same thing, they would have fought him tooth and nail.

Clinton was the exact type of Southern aristocrat who had oppressed and enslaved black people in the early days. But they voted for him in overwhelming numbers. He returned the favor by sharply cutting back the welfare roles (to win conservative support), kicking many blacks off welfare. He was “punished” by being called “the nation’s first black President.”

How can it be that you can spit in someone’s face like this and get away with it? The answer is that politics for these people constitutes an emotional attachment. It is the exact emotion which allows you to root intensely for your high school football team; of course had you gone to the across-town school you would be rooting just as intensely for the opposite team.

The Gold Bug

 

[indago]

Gord wrote:
--------------------------------------------------------------
This is a straw man. TEFRA was a broad set of taxes and closing of loop holes and amounted to only a fraction compared to the taxes that were reduced. In short much of the revenues that had previously come through income taxes shifted to the TEFRA taxes and increased because of the economic stimulation from the net tax cuts.
--------------------------------------------------------------

TEFRA

On the date 19 August 1982, a resolution, H. Res. 571, was brought before the House of Representatives for consideration which concerned the unconstitutionality of the methods used in the Senate concerning H.R. 4961, Tax Equity and Fiscal Responsibility Act (TEFRA). The resolution stated: Resolved, That the Senate amendments to the bill, H.R. 4961, in the opinion of the House, contravene the first clause of the seventh section of the first article of the Constitution of the United States, and that the action of the conferees on H.R. 4961 and the Senate amendment thereto in agreeing to provisions of the Senate amendment further contravene said constitutional requirement and that the action of the Senate and the action of the conferees is an infringement of the privileges of this House and that the Senate bill with the Senate amendments be respectively returned to the Senate with a message communicating this resolution.

Mr. Rostenkowski then moved to lay the resolution on the table, a move to sidestep the issue and move on with the bill. The resolution was laid on the table.

Representative Henson Moore, speaking on the floor of the House of Representatives concerning another rule on this subject, stated: "Mr. Speaker, I take this time on the rule to point out to my colleagues that, as the chairman of the Rules Committee indicated, this rule waives all points of order. To me this rule is indicative of what has happened in the violating of all principles of legislation all along the way that this bill has followed from the day it began. It started by violating the most important principle, article 1, section 7, clause 1 of the Constitution since this was a revenue-raising bill and it began in the Senate and not in the House, as that provision of the Constitution plainly provides. ...At the time we voted to go straight to conference, the Senate bill was not even in print. Nobody in the House even knew what was in it, but they voted to send it on to conference, putting the stamp of approval on it of the House of Representatives of the United States of America. ...If the Members will check with their offices, the conference report was just delivered this morning. It just got here. It has 400 pages of small print, single spaced, that I doubt any Member of the House will have read by the time he or she is called upon to vote on it this afternoon. Look at this history of the rules we have violated, the rules of law, the rules of legislative procedure, the rules of the House. ...When we tear down the rules that govern our Nation, then who shall protect the people?"

The Constitutional mandate at issue has been termed the "Origination Clause", and is the provision that: All Bills for raising Revenue shall originate in the House of Representatives; but the Senate may propose or concur with Amendments as on other Bills. US Const Art 1 Section 7 clause 1

Jonathan Rosenberg, writing for Northwestern University Law Review concerning TEFRA and its unconstitutional passage, noted that Senator Dole, Chairman of the Senate Finance Committee, was asked why TEFRA did not originate in the House, and replied, "Well, I'll be very honest, because the House didn't want to originate it." Mr. Rosenberg noted: "Representative Rostenkowski, Chairman of the House Ways and Means Committee, admitted during House debates over the constitutionality of TEFRA that "the severe economic distress and volatile political environment at this moment" counselled the House to disregard the mandate of the origination clause in this instance. ...The House's acquiescence to the Senate's usurpation of its power does not render such unconstitutional acts constitutional. The framers intended that the immediate representatives of the people should not be able to dodge their accountability to their constituents when raising the people's taxes. ...In the area of taxation, the political branches do not have unfettered discretion but must follow the mandates of the Constitution... ...Although the framers saw Congress as the principle policy making institution in government, they sought to design a system which would assure the greatest amount of accountability for the consequences of those policy decisions. The origination clause is part of this system of accountability. If Congress is allowed to decide if and when it will follow the origination clause, it will be more likely to "abuse" its legislative authority and, ultimately, will be more likely to become less accountable and responsive to its constituency."

The part of TEFRA that was objectionable to some of the members of the Congress was, as noted in Tax Notes, 10 January, 1983,: "On December 15, 1981, the House passed H.R. 4961, a revenue-reduction bill. The Senate Finance Committee substituted a revenue-raising bill for the House provisions and reported the bill out of committee as the Tax Equity and Fiscal Responsibility Act of 1982 (TEFRA)."

Mr. Rosenberg noted that the Supreme Court of the United States had just that year, in another case, stated: "...the choices we discern as having been made in the Constitutional Convention impose burdens on governmental processes that often seem clumsy, inefficient, even unworkable, but those hard choices were consciously made by men who had lived under a form of government that permitted arbitrary governmental acts to go unchecked. There is no support in the Constitution or decisions of this Court for the proposition that the cumbersomeness and delays often encountered in complying with explicit Constitutional standards may be avoided, either by the Congress or by the President."



-

 

[Neubarth]

As I have told my kids, "What the politicians promise you and what they deliver are often quite different. Measure a candidate not on what he or she promises, but what he or she has delivered in the past."

I did not vote for Clinton, but I wish I had, so I could brag about it. Other than his womanizing, he was a damn good president, a million times better than the guy who followed him. I can not say I voted for him either, because by then I was burned out on the candidates of both parties and started writing in my name even though I was not a candidate. At least nobody could blame me for putting "That Jerk" in office. I never voted for That Jerk, only this jerk.

 

[editec]

No, certainly not. It's irrelevant, it doesn't represent reality.

So why do you keep bringing it up?

Because you dismissed the fact as irrelevant once you realized you were wrong.

On the one hand, you seem to think that it was a part of the american worker's better status in decades past; but then you concede my point, which is that the rate was never truly 90% to begin with. I'm honestly not even sure what you're trying to say here.

I conceded no such point.

The tax rate was not a question of opinion, it was the fact.

No, I understand that part. That's part of my point. The whole point of high income taxes is to soak the rich.

Nonsense. The point of high taxes is to pay the bills.

But of course you're really not soaking them at all, their wealth is in assets, exactly as you said.

Your verbal gymnastics aren't impressing me, dude.

Even if you had a true 90% rate without loopholes, you're not soaking them. You might be soaking some guy who's trying to expand his small business without taking on excessive debt though.

No guy with a small business was assessed at a 90% tax rate, but nice try to obfucate the fact that you were wrong.

That's why I mentioned the Rockefellers and Fords. You seem to be nostalgic for a mythic age when the rich were heavily burdened for the good of the worker.

I an lostalgic for a time when America wasn't bankrupting it government by giving absurd tax breaks to billionaires when billionaries are responsible for why the government is spending so much damned money to begin with.

But the income tax was always full of loopholes, and the rich are rich due to their stock and real estate holdings and so forth anyway.

Loopholes aside, the fact is that you were wrong, and you cannot bring yoursel to admit it, can you?

Hence all this irrelevant blather you're posting now, I suppose.

 

[SwingVoter]

GOP theory overestimates importance of taxes, and underestimates importance of low commodity prices.

We're in the same cycle we had early 90s and early 2000s. Bubble bursts, commodity prices keep rising, fed raises interest rates, consumers have less money as a result and spend less, economy tanks, fed cuts interest rates, commodity prices drop, consumers have more money, economy comes back, confidence gets excessive, bubble bursts....

has little to do with taxes

 

[Zoomie1980]

I disagree, MO... Trickle down economics is a historic transfer of wealth from the middle class to the rich. Even though times were relatively good, the gap between 'haves' and 'have nots' widened, and few will deny that fact. Supply side economics has also been directly responsible for the cancerous attitudes of greed and 'personal over community' that has permeated our politics. If Obama does nothing but rid us of Trickle-down, voodoo Reganomics, his presidency will be a success, in my opinion.

-Joe

Hate to break the news to you, but "trickle down", supply-side economics is THE global economic system now. It is not going anywhere because it WORKS. In spite of the current crisis. What it means is global citizens are learning they MUST be more personally responsible for their own credit situations because we are now largely FREE to do as we please. We were like kids in a candy store with a fist full of money. We all overreached. The secret to recovery is that we have all grown up a bit and realize that at some point you have to PAY THE FIDDLER. He ALWAYS gets his due.

 

[Zoomie1980]

I think we started doing it during the Clinton Administration.


I say "I think" because we all know that nobody really plays by the rules of sane accounting when it comes to the Federal Budget.

Actually no. The tech bubble grew so fast that tax revenues, for the first time in 100 years grew FASTER than Congress' ability to spend it for a while. Once the tech bubble burst, it was to business as usual. A drunk federal government.

 

[Zoomie1980]

GOP theory overestimates importance of taxes, and underestimates importance of low commodity prices.

We're in the same cycle we had early 90s and early 2000s. Bubble bursts, commodity prices keep rising, fed raises interest rates, consumers have less money as a result and spend less, economy tanks, fed cuts interest rates, commodity prices drop, consumers have more money, economy comes back, confidence gets excessive, bubble bursts....

has little to do with taxes

Commodity prices are tanking, not rising. What are you paying for gas now vs three months ago? Corn? Wheat? FCOJ? All are TANKING.

 

[Zoomie1980]

Yes, I think so. Of course as I've pointed out repeatedly, that 90% is somewhat misleading, and full of loopholes.

If you think that (for example) the heirs of Rockefeller or Henry Ford were actually paying 90% of their wealth each year...well, I've got a bridge to sell you. (If they had been paying 90% each year, obviously they would be completely broke by now.)



No, total spending went down after WWII. It started going back up during Vietnam. Then the next big burst was during the Reagan years. The Clinton years were relatively restrained, and the Bush years weren't. Hmm, I'm beginning to notice a pattern here...



Yep. And we've convinced ourselves that borrowing will effect our children only, and will have no effect on today's economy. Meanwhile nobody can figure out why virtually everything not outsourced to china is becoming so unaffordable--education, health care, housing, energy.

The loopholes where EVERYWHERE. I remember in back in 1983, my wife and I made $53,000 and we payed $240 in Federal income taxes. And I was in a 50% bracket back then. I was writing EVERYTHING off. A "home office", my Apple IIc computer because I used it to type up papers for work. My car, of course used for "business". There was no 7.5% of gross income limitation back in those days. I even wrote off 100% of my military Officer Clubs dues as a business expense!

When Reagan busted back the tax brackets, he also closed most of the loopholes. I pay a higher percentage of my income in federal income taxes than at any point in my life to date. There just aren't many loopholes in the tax code anymore. It is big reason behind the fact the top 1% pay the highest percentage of federal taxes than at any time in American history.