Why is it so hard to understand that TAX cuts INCREASES tax revenues?

[healthmyths]

Why is it so hard to understand that TAX cuts INCREASES tax revenues?

It's not hard to understand, and equally not hard to reject as mindless BULLSHIT.

Liberals pay taxes, Economists pay taxes and guess what, nobody LIKES to pay taxes, so if there was some to pay less while government would collect more EVERYONE would be for it.

But like most free lunches that are too good to be true, self financing revenue increasing tax rate reductions from current tax rates is simply NOT TRUE, as economists left right and center will assure you.

Even rightwinger like Laffer himself, after whom the Laffer Curve is named would not say that Bush's tax cuts self-financed (never mind INCREASED revenues)

Tax Cuts Don't Boost Revenues

Explain this then!
Note: The events that occurred COST federal money NO question! YET in spite of that greater expenditures REVENUES increased in 2005,6,7 and would have in 2008 IF THIS event hadn't of occurred. And by the way TARP has been REPAID all $800 Billion!

The 9/18/2008 Economic Terrorist Attack:
On Thursday (Sept 18), at 11 in the morning the Federal Reserve noticed a tremendous draw-down of money market accounts in the U.S.,
to the tune of $550 billion was being drawn out in the matter of an hour or two.
The Treasury opened up its window to help and pumped a $105 billion in the system and quickly realized that they could not stem the tide.
We were having an electronic run on the banks.
They decided to close the operation, close down the money accounts and announce a guarantee of $250,000 per account so there wouldn't be further panic out there. If they had not done that, their estimation was that by 2pm that afternoon, $5.5 trillion would have been drawn out of the money market system of the U.S., would have collapsed the entire economy of the U.S., and within 24 hours the world economy would have collapsed. It would have been the end of our economic system and our political system as we know it...
http://seekingalpha.com/article/119619-how-the-world-almost-came-to-an-end-on-september-18-2008

 

[healthmyths]

Just more right wing fantasy? Why not show the debt correlation to lowering taxes.

Because the debt correlation is directly attributable to spending, not income.

However, healthmyths isn't doing his argument any favors with that chart. I am a believer in tax cuts to stimulate growth, provided that equal cuts in spending happen. But the chart shows an increase in revenue BEFORE the tax cuts happened. The ability to read a chart is crucial. The growth in revenue can be more easily attributed to population growth.

OK... growth revenue population growth. So all those people don't spend any money which grew the economy which increased revenues. Wow... what a concept! population growth spent everything on taxes. That's the only attribution. Of course spending increased and I for one totally decry federal government spending on non-defense of country issues! I mean that is a given! The point is even Arthur Laffer says there is a point where taxes must be paid... but not 90%!

I agree. I'm just saying that the chart you provided doesn't help you make your argument.

Ok whatever MAKES you feel superior! At least I provided some validation. Why don't you dig up some substantiation? It's easy to criticize.

I don't do this to make Myself feel superior, but to keep those who think that we can tax and spend our way to prosperity from locking onto a single point of reference. When they do, they become dumb monkeys, unable to even consider any other information. That leads to an end of any rational thought on their part.

My sources for the information I use are books, and they are not so easily linked. But you could try Thomas Sowell as a starter.

And Thomas Sowell is great. Don't disagree.
BUT you can't make a critique of something without sourcing your criticism. Which I in almost all that I submit I provide. That's what makes the internet so helpful!

 

[danielpalos]

Because the debt correlation is directly attributable to spending, not income.

However, healthmyths isn't doing his argument any favors with that chart. I am a believer in tax cuts to stimulate growth, provided that equal cuts in spending happen. But the chart shows an increase in revenue BEFORE the tax cuts happened. The ability to read a chart is crucial. The growth in revenue can be more easily attributed to population growth.

You mean, fiscal responsibility. Since, you agree that spending and revenue should be in the same "ball park".

No, but I agree that there should be no talk of taxation until real progress is made on defining 'legitimate' spending by the Federal government and their abuse of the States.

It simply cannot be argued with any voracity that tax cuts do not create stimulus. However, it also cannot be stated that tax cuts without a corresponding level of spending cutes will create a stimulus. What it (spending) does is burden future generations with unimaginable taxation to cover the lack of responsible spending and mature priorities of government.

Excuse Me, but today I'm making a batch of watermelon wine and I can't spend all day discussing economics 101. Have a nice day.

We have a general welfare clause and a common defense clause. It seems simple, to any federalist.

The general welfare clause does not specifically address individuals. Any careful reading of the Constitution will tell you that the general welfare is in reference to the overall health and security of the nation.

Enjoy.

Very true

And sometimes helping one group is good for the entire country

The general welfare clause is general, not major or specific or common.

 

[AntonToo]

Why is it so hard to understand that TAX cuts INCREASES tax revenues?

It's not hard to understand, and equally not hard to reject as mindless BULLSHIT.

Liberals pay taxes, Economists pay taxes and guess what, nobody LIKES to pay taxes, so if there was some to pay less while government would collect more EVERYONE would be for it.

But like most free lunches that are too good to be true, self financing revenue increasing tax rate reductions from current tax rates is simply NOT TRUE, as economists left right and center will assure you.

Even rightwinger like Laffer himself, after whom the Laffer Curve is named would not say that Bush's tax cuts self-financed (never mind INCREASED revenues)

Tax Cuts Don't Boost Revenues

Explain

Conflation of correlation and CAUSATION. Revenues are not a function of just tax-rates and as economy grows so do revenues that tax this activity.

What is it that you think you are going to post that economists just don't know? Do you think there is some grand conspiracy by them to not make a career by finding a free economic lunch where I pay less taxes and government ends up with more money?

 

[danielpalos]

As I pointed out in the first comment, it is extremely hard to get through some very dense people's brains that growing Federal Tax revenue in the short run will work by increasing the tax rates NO question! As more and more people pay more taxes they have to ask,"why am I working my butt off to pay for idiocies like below?"
BUT if in the process of controlling idiocies like the below (Which Trump is doing!!!) AND reducing tax rates, the following ratio will also REDUCE as tax revenues increase!
View attachment 149151
Top 7 Wackiest Examples of Wasteful Government Spending from Wastebook 2014
1. The National Institute of Health’s Center for Alternative and Complimentary Medicine spent $387,000 to study the effects of Swedish massages on rabbits.
2. The Department of Interior spent $10,000 to monitor the growth rate of saltmarsh grass. In other words, the government is paying people to watch grass grow. On the bright side, they have not started paying people to watch paint dry.
3. The National Science Foundation has granted more than $200,000 to a research project that is trying to determine how and why Wikipedia’s War on Woman?
4. The National Institute of Health funded a study to see if mothers love dogs as much as they love kids. Regardless of the results, this experiment cost taxpayers $371,026.
5. The federal government has granted $804,254 for the development of a smartphone game called “Kiddio: Food Fight.” The game is intended to teach parents how to convince their children to try and eat new healthier food choices.
6. The National Endowment for the Humanities has provided $47,000 for undergraduate classes that teach students about laughing and humor.
7. The National Science Foundation spent $856,000 to teach mountain lions how to walk on treadmills as part of a research project whose aim was to better understand mountain lions’ instincts.
Top 7 Wackiest Examples of Wasteful Government Spending from Wastebook 2014

There is no power implied to promote the common defense into the common offense or general warfare.

Any authorization for a standing army must be funded by a dedicated tax. A, Standing Army Tax, for example.

 

[BluesLegend]

The left use tax increases to PUNISH their enemies, not to increase revenue. So you can argue that tax cuts increase revenue until you are blue in the face they don't care.

 

[g5000]

Zero tax rates would increase revenues to infinity!

 

[g5000]

It seems that many people primarily uninformed people don't see HOW the correlation between reducing taxes can increase revenue.
The primary reason they don't understand is fundamentally they don't know:
1) simple arithmetic.
2) that don't know what happens to money.
View attachment 149122

Do Tax Cuts Increase Government Revenue?

Why according to the above chart does receipts increase as marginal tax decreases?
1) Simple arithmetic.
If taxable income grows tax receipts increase. Simple.
$1,000 taxable income 90% tax $900.
But if taxable income grows to $2,000 and tax is 70% $1,400 versus $900. Simple.
Now some people say "well if the tax was still at 90% it would be $1,800! WRONG!
Because there was NO reason for the taxable income to grow if all it did was pay more taxes!
2) Don't know what happens to money.
Most naive and uninformed people I honestly believe think that people that have excess money:
a) put the money in a mattress or bury it in the backyard. Seriously! They don't seem to comprehend
b)the excess money is
1) spent on consumer goods, more cars, more clothes, more housing, more food.
2) or save putting into the bank which by the way then the bank lends to people to spend..
3) or invest in business to hire more people, spend more money

It is that simple.
The economic multiplier states for every $1 million spent, IT is multiplied by 1.18 or the economy grows with that $1 trillion to $1.2 trillion.
• $1.188 million in total economic activity takes place for every $1 million spent..
• Each $1 million spent provides $205,829 in labor incomes
• Each $1 million represents 7.7 workers and assuming 35% (payroll taxes, FICA, FUTA, Medicare, SS)
http://www2.econ.iastate.edu/research/webpapers/paper_13143.pdf

Sorry, but you are an idiot.

As a percentage of GDP, tax revenues have been a flat line since WWII. Until 2000, when it started dipping.

Revenues are affected more by the state of the economy than by tax rates.

 

[danielpalos]

The left use tax increases to PUNISH their enemies, not to increase revenue. So you can argue that tax cuts increase revenue until you are blue in the face they don't care.

The right builds for-profit prisons.

The left is learning how to merely use capital for all of its worth in modern times.

Hoover Dam and the Fed are examples of, "public sector means of production" that defray the cost of government.

Better (hydro-power generating) aqueducts and better (solar power generating) roads, along with more, well regulated militia, is always an answer.

 

[Slade3200]

healthmyths im still waiting for some real numbers from your "simple" math model. What is your prediction for how the numbers will play out at a reduced tax rate? I'd like to see the realistic kind of growth that you think will result in this change.

I'll make it easy for you so you can just fill in the blanks...

Last fiscal years tax rate = %
Last fiscal years taxable income =
Last fiscal years tax revenue =
Last fiscal years GDP =

Now Healthmyths predictions:

Desired tax rate = %
Predicted taxable income =
Predicted tax revenue =
Predicted GDP =

Lets see what you got

 

[healthmyths]

It seems that many people primarily uninformed people don't see HOW the correlation between reducing taxes can increase revenue.
The primary reason they don't understand is fundamentally they don't know:
1) simple arithmetic.
2) that don't know what happens to money.
View attachment 149122

Do Tax Cuts Increase Government Revenue?

Why according to the above chart does receipts increase as marginal tax decreases?
1) Simple arithmetic.
If taxable income grows tax receipts increase. Simple.
$1,000 taxable income 90% tax $900.
But if taxable income grows to $2,000 and tax is 70% $1,400 versus $900. Simple.
Now some people say "well if the tax was still at 90% it would be $1,800! WRONG!
Because there was NO reason for the taxable income to grow if all it did was pay more taxes!
2) Don't know what happens to money.
Most naive and uninformed people I honestly believe think that people that have excess money:
a) put the money in a mattress or bury it in the backyard. Seriously! They don't seem to comprehend
b)the excess money is
1) spent on consumer goods, more cars, more clothes, more housing, more food.
2) or save putting into the bank which by the way then the bank lends to people to spend..
3) or invest in business to hire more people, spend more money

It is that simple.
The economic multiplier states for every $1 million spent, IT is multiplied by 1.18 or the economy grows with that $1 trillion to $1.2 trillion.
• $1.188 million in total economic activity takes place for every $1 million spent..
• Each $1 million spent provides $205,829 in labor incomes
• Each $1 million represents 7.7 workers and assuming 35% (payroll taxes, FICA, FUTA, Medicare, SS)
http://www2.econ.iastate.edu/research/webpapers/paper_13143.pdf

Sorry, but you are an idiot.

As a percentage of GDP, tax revenues have been a flat line since WWII. Until 2000, when it started dipping.

Revenues are affected more by the state of the economy than by tax rates.

DUH.... AND where does TAX REVENUES come from??? THE ECONOMY! GEEZ... Do you really think that the government drives the economy?
So dummies like you think that the government creates "revenues"???

 

[g5000]

There is a point where tax rates are so high that revenues begin dropping. That is because no one is going to produce more if the government is going to take 90 percent of your gains.

So if you start tax rates at 100 percent, there is some lower number at which tax revenues will increase.

However, if you set tax rates to 0, you will also get no revenue. There is some point at which tax revenues will increase as you increase tax rates from zero.

Only retards lock themselves into the idiotic claim that "lower tax rates = higher revenues." The stupidity of that statement is exploded when you put tax rates to zero.

There is a HAPPY MEDIUM at which you maximize tax revenues. It is blazeningly obvious to anyone with a double digit IQ that if you lower tax rates too much, tax revenues will drop.

 

[BluesLegend]

The left use tax increases to PUNISH their enemies, not to increase revenue. So you can argue that tax cuts increase revenue until you are blue in the face they don't care.

The right builds for-profit prisons.

The left is learning how to merely use capital for all of its worth in modern times.

Hoover Dam and the Fed are examples of, "public sector means of production" that defray the cost of government.

Better (hydro-power generating) aqueducts and better (solar power generating) roads, along with more, well regulated militia, is always an answer.

If anyone even attempted to build a dam and hydroelectric power plant today the left would file 100 lawsuits and protest it daily.

 

[g5000]

It seems that many people primarily uninformed people don't see HOW the correlation between reducing taxes can increase revenue.
The primary reason they don't understand is fundamentally they don't know:
1) simple arithmetic.
2) that don't know what happens to money.
View attachment 149122

Do Tax Cuts Increase Government Revenue?

Why according to the above chart does receipts increase as marginal tax decreases?
1) Simple arithmetic.
If taxable income grows tax receipts increase. Simple.
$1,000 taxable income 90% tax $900.
But if taxable income grows to $2,000 and tax is 70% $1,400 versus $900. Simple.
Now some people say "well if the tax was still at 90% it would be $1,800! WRONG!
Because there was NO reason for the taxable income to grow if all it did was pay more taxes!
2) Don't know what happens to money.
Most naive and uninformed people I honestly believe think that people that have excess money:
a) put the money in a mattress or bury it in the backyard. Seriously! They don't seem to comprehend
b)the excess money is
1) spent on consumer goods, more cars, more clothes, more housing, more food.
2) or save putting into the bank which by the way then the bank lends to people to spend..
3) or invest in business to hire more people, spend more money

It is that simple.
The economic multiplier states for every $1 million spent, IT is multiplied by 1.18 or the economy grows with that $1 trillion to $1.2 trillion.
• $1.188 million in total economic activity takes place for every $1 million spent..
• Each $1 million spent provides $205,829 in labor incomes
• Each $1 million represents 7.7 workers and assuming 35% (payroll taxes, FICA, FUTA, Medicare, SS)
http://www2.econ.iastate.edu/research/webpapers/paper_13143.pdf

Sorry, but you are an idiot.

As a percentage of GDP, tax revenues have been a flat line since WWII. Until 2000, when it started dipping.

Revenues are affected more by the state of the economy than by tax rates.

DUH.... AND where does TAX REVENUES come from??? THE ECONOMY! GEEZ... Do you really think that the government drives the economy?
So dummies like you think that the government creates "revenues"???

You are just too stupid to talk to.

 

[danielpalos]

healthmyths im still waiting for some real numbers from your "simple" math model. What is your prediction for how the numbers will play out at a reduced tax rate? I'd like to see the realistic kind of growth that you think will result in this change.

I'll make it easy for you so you can just fill in the blanks...

Last fiscal years tax rate = %
Last fiscal years taxable income =
Last fiscal years tax revenue =
Last fiscal years GDP =

Now Healthmyths predictions:

Desired tax rate = %
Predicted taxable income =
Predicted tax revenue =
Predicted GDP =

Lets see what you got

It only works in a vacuum of special pleading.

The right wing prefers fantasy to fiscal conservatism when dealing with the budget, not social programs, specifically.

One percent growth should be all the credit allowed to the right wing.

 

[BluesLegend]

When it was pointed out to the left that corporations were leaving the US due to the sky high corporate taxes the left foamed at the mouth and said fine let them leave and called them names. This is the juvenile stupidity we are dealing with on the left.

 

[danielpalos]

The left use tax increases to PUNISH their enemies, not to increase revenue. So you can argue that tax cuts increase revenue until you are blue in the face they don't care.

The right builds for-profit prisons.

The left is learning how to merely use capital for all of its worth in modern times.

Hoover Dam and the Fed are examples of, "public sector means of production" that defray the cost of government.

Better (hydro-power generating) aqueducts and better (solar power generating) roads, along with more, well regulated militia, is always an answer.

If anyone even attempted to build a dam and hydroelectric power plant today the left would file 100 lawsuits and protest it daily.

aqueducts are not dams. we should be able to move water from one point of the US to another to solve for droughts and flooding.

 

[healthmyths]

healthmyths im still waiting for some real numbers from your "simple" math model. What is your prediction for how the numbers will play out at a reduced tax rate? I'd like to see the realistic kind of growth that you think will result in this change.

I'll make it easy for you so you can just fill in the blanks...

Last fiscal years tax rate = %
Last fiscal years taxable income =
Last fiscal years tax revenue =
Last fiscal years GDP =

Now Healthmyths predictions:

Desired tax rate = %
Predicted taxable income =
Predicted tax revenue =
Predicted GDP =

Lets see what you got

No

healthmyths im still waiting for some real numbers from your "simple" math model. What is your prediction for how the numbers will play out at a reduced tax rate? I'd like to see the realistic kind of growth that you think will result in this change.

I'll make it easy for you so you can just fill in the blanks...

Last fiscal years tax rate = %
Last fiscal years taxable income =
Last fiscal years tax revenue =
Last fiscal years GDP =

Now Healthmyths predictions:

Desired tax rate = %
Predicted taxable income =
Predicted tax revenue =
Predicted GDP =

Lets see what you got

WHAT the f...k does GDP have anything to do with revenue, taxes etc? NOT a damn thing! Besides GUESS WHAT MAKES UP the GDP???
THE FEDERAL GOVERNMENT! So if you really want to measure GDP accurately TAKE AWAY Federal REVENUES because THAT adds to the GDP.
So consequently your "MATH" is flawed!

 

[Slade3200]

healthmyths im still waiting for some real numbers from your "simple" math model. What is your prediction for how the numbers will play out at a reduced tax rate? I'd like to see the realistic kind of growth that you think will result in this change.

I'll make it easy for you so you can just fill in the blanks...

Last fiscal years tax rate = %
Last fiscal years taxable income =
Last fiscal years tax revenue =
Last fiscal years GDP =

Now Healthmyths predictions:

Desired tax rate = %
Predicted taxable income =
Predicted tax revenue =
Predicted GDP =

Lets see what you got

It only works in a vacuum of special pleading.

The right wing prefers fantasy to fiscal conservatism when dealing with the budget, not social programs, specifically.

One percent growth should be all the credit allowed to the right wing.

He can ignore me all he wants I'm gonna keep asking him to back up is OP. If we want to have a real discussion about a plan then lets look at real numbers not arbitrary numbers of 90% tax rates and doubling of income. Put real rates and real income in the equation and then make realist predictions of growth and lets take a look.

 

[healthmyths]

It seems that many people primarily uninformed people don't see HOW the correlation between reducing taxes can increase revenue.
The primary reason they don't understand is fundamentally they don't know:
1) simple arithmetic.
2) that don't know what happens to money.
View attachment 149122

Do Tax Cuts Increase Government Revenue?

Why according to the above chart does receipts increase as marginal tax decreases?
1) Simple arithmetic.
If taxable income grows tax receipts increase. Simple.
$1,000 taxable income 90% tax $900.
But if taxable income grows to $2,000 and tax is 70% $1,400 versus $900. Simple.
Now some people say "well if the tax was still at 90% it would be $1,800! WRONG!
Because there was NO reason for the taxable income to grow if all it did was pay more taxes!
2) Don't know what happens to money.
Most naive and uninformed people I honestly believe think that people that have excess money:
a) put the money in a mattress or bury it in the backyard. Seriously! They don't seem to comprehend
b)the excess money is
1) spent on consumer goods, more cars, more clothes, more housing, more food.
2) or save putting into the bank which by the way then the bank lends to people to spend..
3) or invest in business to hire more people, spend more money

It is that simple.
The economic multiplier states for every $1 million spent, IT is multiplied by 1.18 or the economy grows with that $1 trillion to $1.2 trillion.
• $1.188 million in total economic activity takes place for every $1 million spent..
• Each $1 million spent provides $205,829 in labor incomes
• Each $1 million represents 7.7 workers and assuming 35% (payroll taxes, FICA, FUTA, Medicare, SS)
http://www2.econ.iastate.edu/research/webpapers/paper_13143.pdf

Sorry, but you are an idiot.

As a percentage of GDP, tax revenues have been a flat line since WWII. Until 2000, when it started dipping.

Revenues are affected more by the state of the economy than by tax rates.

DUH.... AND where does TAX REVENUES come from??? THE ECONOMY! GEEZ... Do you really think that the government drives the economy?
So dummies like you think that the government creates "revenues"???

You are just too stupid to talk to.

Well you show how dumb you are! We are duh WRITING... not "talking"! You can't even make that distinction?