Bush to annonce $600 Bn Tax Cut

[Dinner]

Bush also hasn't weighted the long term drag (by pushing up borrowing costs for everyone else) his deficit spending has on the economy. Cutting taxes is good but balancing the budget and eliminating the national debt would be a boon to everyone in the country who has a morgage or pays a credit card.

[chequita guevara]

Why can't I just pay taxes on my "profits?" I assure you, I have none.

[Lawrence of Arabia]

[Ned]

Seeing the numbers on who pays taxes -- one set of figures showed that the top 50% in terms of income paid 96% of income taxes -- one cannot significantly cut taxes unless taxes of the top 50% are cut.

[chequita guevara]

Man, this country is really gonna be a shambles once the Republicans are finally thrown out.

[orange]

Originally posted by Shi Huangdi
The problem with taxing corporations is that the extra expense often gets passed on to consumers and employees..... Taxing the wealthy directly would be a better method of progressive taxation.

Unfortunately yes It seems that if they're going to pay more, might as well not give labour a raise and charge more for the product...inflation and all that good stuff...it's just a shame that they are provided the freedom and security to make so much money and there's no way to assure that they give some of it back to pay for that freedom and security.

Oerdin - Deficit spending isn't necessarily a bad thing as long as you have a somehwat reasonable outlook that it'll jump start the economy...obviously some spending coupled with a tax cut aimed at consumers would be best and avoid putting all the eggs in one basket, though.

[Ned]

Che, Why isn't it Marxist to try to raise taxes on the top 50% of Americans and provide benefits for those on the bottom 50% so the outcomes are equal?

"From those according to their ability. To those according to their needs."

[chequita guevara]

Marxism isn't about simple wealth re-distribution, it's about changing the relations of production. Only when the people who do the work control their work with they be able to control their lives. It's about creating democracy in all public spheres of life: work, education, civic duty, etc. . . . Which of course makes the experiments carried out in its name incredibly ironic.

[Adam Smith]

OK, so HERE is the Democrats' proposal.

• extending unemployment insurance - I have no rpoblem with that; it should have been in the pipeline already
• $300 per person tax rebate - no real problem with this, but would have been better to increase the earned income tax credit instead
• one year business tax break to promote new investment - we tried this before and it doesnt make any real difference. All it does is shift things around - more investment now, less later.
• $31 bil to pay for homeland security, roads, and Medicare - pure pork. We have no idea how to spend the homeland security money we currently have, sure don't need another road-building program, and should fix medicare through health care reform, not by throwing more money at it.

Lastly, I sure hope that we are not due for several years of overheated economic rhetoric from Rep. Pelosi. While I am sympathetic to those who are unemployed, unemployment is nowhere near "rampant" in any kind of historical perspective. Similarly, I sure hope Rep. Pelosi would not have us head for the old Humphrey-Hawkins policy, which called for the government to maintain a 3 percent unemployment rate, regardless of consequences for budget or inflation..

[orange]

i agree about the homeland security bit...it all seems to be a facade to me...what's REALLY being done about homeland security

[chequita guevara]

Originally posted by Adam Smith
While I am sympathetic to those who are unemployed, unemployment is nowhere near "rampant" in any kind of historical perspective.

Everything is relative. Unemployment is 50% higher than it was several years ago. Also, the length of unemployment is much longer than we're used to seeing (I'm led to believe four months was the previous average, and we have a million people who've already gone past their extentions, let alone the million people who's extentions ran out a week ago Saturday, with 85,000 more every week). I also understand we're back up to 400,000 new claims a week, which is what you see in recessionary times.

I realize that the Bush Administration has only had two years, but we have .2% less jobs than at the begining of the Bush Administration (which isn't to say the Bush is to blame, since President's have very little power to effect the economy).

[Static Universe]

Bush has no choice now except supply side ideologies. There is ZERO demand right now to borrow money as most economists are starting to admit that we are in a deflationary cycle. Even though real interest rates are closing in on zero or possibly negative rates, which some Fed officials have admitted to, the falling prices of business to business transactions are keeping them from borrowing capital now because they might get a better deal later.

It's a great time to buy a house or car, but not equip a factory.

Unfortunately, Bush seems to be hoping for the situation David Stockman once referred to as the "Rosy Scenario", where these supply side measures will actually work out somehow.

Stockman, if anybody remembers, was Reagan's supply- side guru Budget Director, who later admitted all the numbers were cooked and supply side didn't work.

[chequita guevara]

Didn't Stockman end up in prison?

[Static Universe]

Originally posted by chegitz guevara
Didn't Stockman end up in prison?

Nope. He resigned in 85 and in 86 wrote a book called "The Triumph of Politics" criticizing Reagan and supply side in general.

A very good book by the way, which I read in college and turned me down the road of Anti-Reagan. Stockman was an honest man in the end. Given that we've never paid back a dime Reagan borrowed, his criticisims are still justified today.

I think he works in the financial sector now.

[Lawrence of Arabia]

Here's my predition: The Bush Plan will make it through more or less intact. Unfortunately. Maybe I should start my own political part, based on good economic policy, rather then corporate interests. It'll always be a minority, but thats OK.