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On July 06 2010 11:57 kzn wrote:
[edit] Hell, compared with lowering taxes across the board or disproportionately in favor of poor people, cutting taxes at the highest rates is flat out better economically.
A small part of me died inside. Even taking out all other considerations (morals etc), that argument is wrong in pretty much every respect. Link for you.
+ Show Spoiler +If you can't be bothered reading the link (as seems to happen..) the reason why cutting taxes on poor will have a larger effect on the economy is that poorer people spend a larger proportion of their income than richer people due to the nature of what they are buying (needs, rather than wants).
Also:
- Affects a larger proportion of your economy. (everything other than luxury items)
- Poor peoples MPC is much higher, so a higher multiplyer effect
- Demand for primary goods increases, as people have more money to spend
Regardless, like previously stated, cuts are generally not as good as government spending for stimulating the economy... as at least you can be sure the money damn well gets spent...
To answer the OPs original question:
This thread has become devided (expectidly) and somewhat derailed by conservative/liberal discussion. Look at where the 'conservative' view points come from (not one from out side the US) and then look at where the 'liberal' view points are coming from (pretty much all outside the us).
In short: Yes.
In actuality: No.
There are more ways to view the world than through 'liberal' or 'conservative' eyes. That and the 'left/right' scale barely even applies to economics (as there is so many different places you could 'spend big' or 'cut spending' that it just holds no real value to aggrigate them all) let alone to the political spectrum.
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I'm not sure I understand how the word "bias" is being used here.
Greater numbers of liberals on the internet as opposed to conservatives? Well, that's kind of a hard question. What passes for "liberal" in the US is actually pretty conservative in Europe. And what passes for "conservative" in the US is considered pretty insane in most of Europe, just for an example.
Also, there aren't two equal sides to any political argument. If one side is supported by reality and the other isn't, and more people support the side supported by reality, that's not a "bias", that's just not being stupid. America is infected with this idea of false equivalency.
I'm not saying the "liberals" are on the side of reality or the reverse. I'm saying Americans' use of the word "bias" is extremely suspect.
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Ok I said I wasn't going to post but I feel I have to now.
On July 06 2010 12:23 Djzapz wrote:Show nested quote +Is the country not just an aggregation of many individuals?
Then what bad can come out of something other than?
By the country suffers, surely you mean "that group of individuals who support stealing from others to get what they want" The country is an aggregation of many individuals who oftentimes cooperate in order to get what they want.
voluntarily, most of the time, yes.
On July 06 2010 12:23 Djzapz wrote: You pay the government, the government makes you roads.
Why does it have to be the gunverment, and why does it have to take money without asking, and not do it voluntarily like any other entrepreneur?
On July 06 2010 12:23 Djzapz wrote: Rich people pay more taxes than the poor, this allows the poor to buy the rich's products.
And tax-cutting the rich would allow him to cut prices, allowing the poor to buy more junk.
So what? A tax is a tax, taking money from the market and using it for some arbitrary end that may or may not turn to be somewhat useful to some of the taxpayers (always with added overhead of course).
On July 06 2010 12:23 Djzapz wrote: Without the US supporting you, you most likely wouldn't be as comfortable. Progressive taxes are key to making an economical country, economical countries sustain their citizen.
Why wouldn't I be more comfortable?
On July 06 2010 12:23 Djzapz wrote:
Some people can't work. Arguably they steal a tiny percentage of your money, get a disability check. Because of you, a disabled person can live an OK life. In other countries, this isn't as true. Luckily, like all of the other first world countries, you have a progressive tax system. A powerful economical country has never been seen without this system.
That which is has no bearing on how it should be. If we were all monarchies still, it would make aristocracy no more deplorable to the ones who can envision a world without kings, ahead of their time.
On July 06 2010 12:23 Djzapz wrote:
Some people abuse the system but this happens in all systems. Unfortunately some people sit on their hands and collect welfare. A great many of those are single mothers who make good use of this service. Personally I'm glad that a tiny percentage of my taxes goes to help single mothers. It's sad that there are people who benefit from it but are just lazy.
Well, when you have a direct incentive for people not to work... I'd say it's a bit predictable that people would be more likely to not work... if you know anything about human action...
On July 06 2010 12:23 Djzapz wrote:
I think it's sad that an extremely big portion of all of your paychecks goes to fund multiple wars in an extremely inefficient way...
I think it's sad that the paychecks go anywhere but the employee's pocket period.
On July 06 2010 12:23 Djzapz wrote:
Alone, you're nothing.
I agree.
On July 06 2010 12:23 Djzapz wrote: Keep in mind, the US gave you everything you got.
I disagree LOL
On July 06 2010 12:23 Djzapz wrote: The US is the workframe which gave you the opportunity to become rich or at the very least live an above-average comfortable life.
Assuming that by US you mean the US government, what workframe is that?
You mean private property and laws wouldn't exist without the government?
Well that's debatable, and I doubt you know anything about anarcho-capitalism, but I'm not going to bother trying to explain how it could work, too tired ATM, sorry.
On July 06 2010 12:23 Djzapz wrote: If you were born in Sierra-Leone, you would need to be significantly better of a person to be as successful as your regular american.
Maybe, but is it because of the government here?
I think the standards of living in the US are this way despite what the government does, not thanks to it.
On July 06 2010 12:23 Djzapz wrote: You're lucky to have been raised in the US.
Okay.
On July 06 2010 12:23 Djzapz wrote: You're lucky that people, in the past, have paid taxes in order to build a decent infrastructure.
Infrastructure which could have been built voluntarily and more efficiently had people knew+tried.
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lol Anarcho-capitalism.
Capitalism requires infrastructure to work. Certain standards and regulatory bodies like the SEC to make financial markets function. Hell, explain to me how you're going to deal with public goods?
You pay taxes to fund many of the public goods from which you directly/indirectly benefit. Also you pay so that an "impartial" arbiter than you have some control over (elections) maintains the monopoly of force rather than existing in a state of war with everyone. This facilitates economies of scale for many things.
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If you can't be bothered reading the link (as seems to happen..) the reason why cutting taxes on poor will have a larger effect on the economy is that poorer people spend a larger proportion of their income than richer people due to the nature of what they are buying (needs, rather than wants).
Also:
- Affects a larger proportion of your economy. (everything other than luxury items)
- Poor peoples MPC is much higher, so a higher multiplyer effect
- Demand for primary goods increases, as people have more money to spend
Regardless, like previously stated, cuts are generally not as good as government spending for stimulating the economy... as at least you can be sure the money damn well gets spent...
This is true (especially in the short-term), but cutting taxes in the highest brackets typically generates more in gross tax revenue.
See also - Laffer curve (http://en.wikipedia.org/wiki/Laffer_curve)
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Why does it have to be the gunverment, and why does it have to take money without asking, and not do it voluntarily like any other entrepreneur?
People wouldn't give a sufficient amount of money to build an actual infrastructure. Trying that would certainly be disastrous. If you think otherwise you make huge assumptions about human nature.
And tax-cutting the rich would allow him to cut prices, allowing the poor to buy more junk.
So what? A tax is a tax, taking money from the market and using it for some arbitrary end that may or may not turn to be somewhat useful to some of the taxpayers (always with added overhead of course).
Tax-cutting the rich doesn't affect the production costs and such. Lowering their taxes wouldn't directly affect their prices in a significant way.
Why wouldn't I be more comfortable?
What evidence do you have that a country without a fair amount of taxation can take off at all, it has never even come close to happen. In the US, you can get an OK job fairly easily, get a comfortable apartment or even a house. You get education easily. All of this comes from the taxes people paid before. If people were going "Free for all" like what you're advocating, it would be in the same state as all of the other countries which have tried to do that. Poor and underdeveloped. The countries who have tried flat taxes have done really badly if you care.
That which is has no bearing on how it should be. If we were all monarchies still, it would make aristocracy no more deplorable to the ones who can envision a world without kings, ahead of their time.
What are you suggesting?
I disagree LOL
Provided you were raised in the US, so little of what you have would have been so easy to reach if there wasn't a government taking money from people in order to make it work. If you don't want to pay taxes, go away. The only reason why you want to stay in the US is because it's a good place to live. WHY is it a good place to live? Because it was built to be a good place to live. It was built with taxes. Taxes which used to be a lot higher, btw.
Assuming that by US you mean the US government, what workframe is that?
You mean private property and laws wouldn't exist without the government?
Well that's debatable, and I doubt you know anything about anarcho-capitalism, but I'm not going to bother trying to explain how it could work, too tired ATM, sorry.
People who try to argue for any type of anarchy expect people to be better than they are. If you were to explain anarcho-capitalism, you would make a lot of assumptions about how to build an utopia. If it could work it would be wonderful but it can't.
Maybe, but is it because of the government here?
I think the standards of living in the US are this way despite what the government does, not thanks to it.
Read the name. It's the United-States. That's a body. You're suggesting the standards of living spawned there out of thin air for the couple hundreds years you've been there? That's ridiculous. I'll state the obvious here. Your country's success is largely based on its governing body which made it quickly rise to be the most powerful country in the world. Your money represents a country. Not a bunch of people, not a landmass, but a body which is governed by a president which has taxed its people for a long, long time. It started well before the US was powerful, too.
Infrastructure which could have been built voluntarily and more efficiently had people knew+tried.
People don't know. And people obviously want others to pay for it. Everybody knows that. If a person makes $50,000 a year and some project requires 20 billions to be completed, $5000 is nothing, even $50,000 is nothing. It's foolish to expect people would chip in NEARLY enough. But I guess anarchists can distort human nature so it fits.
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Ugh, why are we having an economic debate in a political thread, guys? How does this connect with the issue of certain demographics' representation on the Net?
@ Yurebis
The infrastructure argument is not exactly well supported. Seriously, would you want to pay toll fees for every road you went through on your way to work, the sidewalks and parkways you walk on when you're out in the park? Infrastructure is sometimes loss leading, in that its benefits don't go back to the government in of itself.
@ Tax cuts vs Spending
It's a philosophical issue of what role government should play, whether to direct it with its hand on things; or let those it represents do the deciding for them.
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On July 06 2010 12:58 Sabu113 wrote:
Capitalism requires infrastructure to work. Certain standards and regulatory bodies like the SEC to make financial markets function.
What happened to the world before the SEC existed?
I'm asking because I don't know really. But I doubt whatever function it exerted couldn't have been operated by a private agency.
Also, what is "function" in that context? Does a market have an objective ends or means?
Some people might not want a financial market at all, so not having the SEC would be perfectly "functional", you see. May look like a non-sequitur, sorry.
On July 06 2010 12:58 Sabu113 wrote: Hell, explain to me how you're going to deal with public goods?
Short answer, privatize.
Long answer... depends, what are those "public goods"? You mean goods owned by the government?
On July 06 2010 12:58 Sabu113 wrote:
You pay taxes to fund many of the public goods from which you directly/indirectly benefit.
Why can't those goods be owned by someone if they're already owned by the government?
And if the government is able to sustain itself monetarily (lol), why can't an entrepreneur?
On July 06 2010 12:58 Sabu113 wrote: Also you pay so that an "impartial" arbiter than you have some control over (elections) maintains the monopoly of force rather than existing in a state of war with everyone. This facilitates economies of scale for many things.
And why can't different people have different arbiters in charge of negotiating conflicts?
That's what happens in the world scale. Different countries with different laws. Why hasn't the world market stopped "functioning"?
Consistently, you must find that horrible, or recognize that it's possible to have you know, voluntary arbitration.
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On July 05 2010 19:42 Neobick wrote:
Edit: My definition of bias is only seeing things from one side, or giving one side an unfair advantage-
Then you are making your own definition based on connotations of the word bias, which is really not what it means.
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On July 06 2010 12:16 Sabu113 wrote:That's just simply factually false. Tax cuts are THE WORST, THE WORST tool of a stimulus program. The multiplier is almost 1 for tax cuts. Romer detailed this in her reports to congress or hell find another non-chicago economist if you want to find support for my claim. The stimulus works because it is guaranteed demand. Tax cuts for the wealthy do not necessarily result increased demand.
No. The Consumption Multiplier is less than 1 for tax cuts. This is precisely why it is better - you end up with more saving, thus more investment, thus you actually fix the recession instead of masking its symptoms.
Moreover, I can see you're one of the people who has been taken in by the hilariously flawed argument that stimulus spending somehow generates more GDP than was spent.
First of all, just think about it for a second. That is not physically possible. You cannot spend $100 and generate more than $100 in spending. IT CANNOT BE DONE.
Once you've realized how stupid the original claim is, you can investigate why it appears to be true. Here's why:
There are two ways you can fund a spending program. You can tax for the money required, or you can borrow for the money required.
In the first case, the "additional" spending generated by the taxation is completely balanced out by the spending it removes in the act of taxation. This is tautologically true.
In the second case, the "additional" spending is generated because the economy has seen an injection of money from the government's borrowing. This is more than completely balanced out because that money has to be paid back, and it has to be paid back with interest.
edit: Christ I hope you guys get some stuff sourced from the literature rather than gop.org or Fox News.
Sourced? I don't need sources when I have a working brain.
On to the next economic fallacy:
If you can't be bothered reading the link (as seems to happen..) the reason why cutting taxes on poor will have a larger effect on the economy is that poorer people spend a larger proportion of their income than richer people due to the nature of what they are buying (needs, rather than wants).
Also:
- Affects a larger proportion of your economy. (everything other than luxury items)
- Poor peoples MPC is much higher, so a higher multiplyer effect
- Demand for primary goods increases, as people have more money to spend
Regardless, like previously stated, cuts are generally not as good as government spending for stimulating the economy... as at least you can be sure the money damn well gets spent...
In order:
It doesn't affect a larger proportion of your economy at all. It doesn't matter how many people are affected, what matters is how much money is affected. A tax cut on the rich doesn't affect many people but it has a huge effect on the people it does. A tax cut on the poor affects tons of people but has a relatively tiny effect on each one.
Fallacious ignoring of savings providing funds for investment, which is better for GDP growth than consumption. If you really want to cause an economy to grow, you stimulate investment, not consumption. This is accomplished better through tax cuts on the rich than anything other than direct government investment.
Another "magic money" argument where this "more money" somehow comes out of nowhere. It doesn't. People have no more money to spend unless stimulus is funded by borrowing, in which case they'll just eat the cost later on instead of now.
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On July 06 2010 13:03 Ammunition wrote:
This is true (especially in the short-term), but cutting taxes in the highest brackets typically generates more in gross tax revenue.
See also - Laffer curve (http://en.wikipedia.org/wiki/Laffer_curve)
No one uses the Laffer Curve seriously. Laffer literally drew it on a hankerchief. You know what the marginal tax rates were in the 50s and 60s during our 20 years of amazing growth and keynesian fiscal policy? 90%.
God being aggressive doesn't help teach people anything, but christ the Laffer curve really?
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I don't think anyone here really understand why tax cuts for the rich are effective. Poor people spend money but they do not invest. Rich people invest. Investment increases movement of credit and stimulates the economy.
If people are investing then you'll see the stock market go up, lower prices, and especially important - creation of jobs. Poor people can spend all the money they want but that money is simply not invested and therefore you end up with poor people with a slightly higher standard of living and the same overall economic status. $1000 for every person in the US won't do anything. Cutting business and wealthy taxes by 10% will create thousands of jobs.
It's all about getting people to invest their money so that the economy can grow.
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Short answer, privatize.
Long answer... depends, what are those "public goods"? You mean goods owned by the government?
If you make a road, you have to have people fund it. Who funds it, who's allowed to use it? Who takes the money? Who collects it? If I haven't paid for it and I want to use it, who do I pay? Can I?
Why can't those goods be owned by someone if they're already owned by the government?
And if the government is able to sustain itself monetarily (lol), why can't an entrepreneur?
How does an entrepreneur benefit from having a road? If you need to pay to use it, isn't that shitty? Why wouldn't he gouge you since you need to use it? What happens if people get angry?
And why can't different people have different arbiters in charge of negotiating conflicts?
Who chooses who negociates conflicts? Bias? There would be a lot of abuse. Who makes sure there's not abuse? How are those people not going to abuse it?
This ends up in this russian dolls situation. It would be extremely complicated on so many levels and the way to fix it is usually through some kind of power which could easily end up trying to become a tyrant or at least some kind of leader. Things would turn wrong. Who makes the decision that your anarchy would work in a certain way so it doesn't go wrong? How would you alter human nature.
So many questions you can't understand without "cheating"
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On July 06 2010 13:19 Sabu113 wrote:No one uses the Laffer Curve seriously. Laffer literally drew it on a hankerchief. You know what the marginal tax rates were in the 50s and 60s during our 20 years of amazing growth and keynesian fiscal policy? 90%.
God being aggressive doesn't help teach people anything, but christ the Laffer curve really?
You know what happened to tax receipts when Reagan cut taxes from 90% to 38%, or whatever it was?
Nothing. Nothing happened. Tax receipts barely blipped for a year.
Left-wing economists don't take the Laffer Curve seriously because they think where it was drawn means something. It is demonstrably and necessarily true that if tax receipts are 0 at 0% taxation and 0 at 100% taxation (which they are), there is a point where lowering your tax rates will generate more revenue. This is all that is actually claimed by the Laffer Curve.
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+ Show Spoiler +On July 06 2010 12:50 Yurebis wrote:Ok I said I wasn't going to post but I feel I have to now. Show nested quote +On July 06 2010 12:23 Djzapz wrote:Is the country not just an aggregation of many individuals?
Then what bad can come out of something other than?
By the country suffers, surely you mean "that group of individuals who support stealing from others to get what they want" The country is an aggregation of many individuals who oftentimes cooperate in order to get what they want. voluntarily, most of the time, yes. Show nested quote +On July 06 2010 12:23 Djzapz wrote: You pay the government, the government makes you roads. Why does it have to be the gunverment, and why does it have to take money without asking, and not do it voluntarily like any other entrepreneur? Show nested quote +On July 06 2010 12:23 Djzapz wrote: Rich people pay more taxes than the poor, this allows the poor to buy the rich's products. And tax-cutting the rich would allow him to cut prices, allowing the poor to buy more junk. So what? A tax is a tax, taking money from the market and using it for some arbitrary end that may or may not turn to be somewhat useful to some of the taxpayers (always with added overhead of course). Show nested quote +On July 06 2010 12:23 Djzapz wrote: Without the US supporting you, you most likely wouldn't be as comfortable. Progressive taxes are key to making an economical country, economical countries sustain their citizen. Why wouldn't I be more comfortable? Show nested quote +On July 06 2010 12:23 Djzapz wrote:
Some people can't work. Arguably they steal a tiny percentage of your money, get a disability check. Because of you, a disabled person can live an OK life. In other countries, this isn't as true. Luckily, like all of the other first world countries, you have a progressive tax system. A powerful economical country has never been seen without this system. That which is has no bearing on how it should be. If we were all monarchies still, it would make aristocracy no more deplorable to the ones who can envision a world without kings, ahead of their time. Show nested quote +On July 06 2010 12:23 Djzapz wrote:
Some people abuse the system but this happens in all systems. Unfortunately some people sit on their hands and collect welfare. A great many of those are single mothers who make good use of this service. Personally I'm glad that a tiny percentage of my taxes goes to help single mothers. It's sad that there are people who benefit from it but are just lazy. Well, when you have a direct incentive for people not to work... I'd say it's a bit predictable that people would be more likely to not work... if you know anything about human action... Show nested quote +On July 06 2010 12:23 Djzapz wrote:
I think it's sad that an extremely big portion of all of your paychecks goes to fund multiple wars in an extremely inefficient way... I think it's sad that the paychecks go anywhere but the employee's pocket period. I agree. Show nested quote +On July 06 2010 12:23 Djzapz wrote: Keep in mind, the US gave you everything you got. I disagree LOL Show nested quote +On July 06 2010 12:23 Djzapz wrote: The US is the workframe which gave you the opportunity to become rich or at the very least live an above-average comfortable life. Assuming that by US you mean the US government, what workframe is that? You mean private property and laws wouldn't exist without the government? Well that's debatable, and I doubt you know anything about anarcho-capitalism, but I'm not going to bother trying to explain how it could work, too tired ATM, sorry. Show nested quote +On July 06 2010 12:23 Djzapz wrote: If you were born in Sierra-Leone, you would need to be significantly better of a person to be as successful as your regular american. Maybe, but is it because of the government here? I think the standards of living in the US are this way despite what the government does, not thanks to it. Show nested quote +On July 06 2010 12:23 Djzapz wrote: You're lucky to have been raised in the US. Okay. Show nested quote +On July 06 2010 12:23 Djzapz wrote: You're lucky that people, in the past, have paid taxes in order to build a decent infrastructure. Infrastructure which could have been built voluntarily and more efficiently had people knew+tried.
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On July 06 2010 13:25 rockon1215 wrote:Personal Taxes and business taxes are different things.
Not for all small businesses.
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On July 06 2010 13:23 kzn wrote:Show nested quote +On July 06 2010 13:19 Sabu113 wrote:No one uses the Laffer Curve seriously. Laffer literally drew it on a hankerchief. You know what the marginal tax rates were in the 50s and 60s during our 20 years of amazing growth and keynesian fiscal policy? 90%.
God being aggressive doesn't help teach people anything, but christ the Laffer curve really? You know what happened to tax receipts when Reagan cut taxes from 90% to 38%, or whatever it was? Nothing. Nothing happened. Tax receipts barely blipped for a year. Left-wing economists don't take the Laffer Curve seriously because they think where it was drawn means something. It is demonstrably and necessarily true that if tax receipts are 0 at 0% taxation and 0 at 100% taxation (which they are), there is a point where lowering your tax rates will generate more revenue. This is all that is actually claimed by the Laffer Curve.
Nothing happened, really? Someone rewrote history without the part where he had to raise the taxes back for 6 of his 8 years because they were way too low and it messed things up?
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On July 06 2010 13:26 Djzapz wrote:
Nothing happened, really? Someone rewrote history without the part where he had to raise the taxes back?
Its flat data. Tax receipts as a % of GDP in the last year before Reagan are ~20%. Tax receipts as a % of GDP in the first year after Reagan cut the top rate to whatever it was are 19%, and they wobble around 19% for the rest of Reagan's term. He sure as fuck never had to go above 50%.
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Tax Equity and Fiscal Responsibility Act of 1982
This is what I got when I searched for "Reagan tax increases". Sad that raising taxes would never be called "fiscal responsibility" today.
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On July 06 2010 13:29 kzn wrote:Show nested quote +On July 06 2010 13:26 Djzapz wrote:
Nothing happened, really? Someone rewrote history without the part where he had to raise the taxes back? Its flat data. Tax receipts as a % of GDP in the last year before Reagan are ~20%. Tax receipts as a % of GDP in the first year after Reagan cut the top rate to whatever it was are 19%, and they wobble around 19% for the rest of Reagan's term. He sure as fuck never had to go above 50%.
Might have something to do with raising taxes 6 years out of 8.
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EPT
