Metalhead, your argument is one of the most absurd I have ever seen and indicates a fundamental lack of any understanding of finance, economics, or the social security program. You spuriously attribute fluctuations in the business cycle and their affects to two changes in fiscal policy? Your analysis is woefully incomplete and downright laughable.
For someone who believes that the government = public wealth, i.e. doesn't believe that folks should be allowed to keep the money that they earned...sure it makes sense.
I think first of all, one of the major effects of the tax cuts are more growth. I am not surprised at what is happening in the economy, businesses and people have a lot more money to work with now that the government is taking less. Experts are too static in their analysis and that's why they didn't see it coming. Secondly, yes, large deficits and debt are very bad for our economy. I am dissappointed Bush is spending WAY too much money on pretty much everything. I hope he tries to reign in the spending somehow. (But I still support the tax cuts despite this, because I think Congress would have just spent all the money anyways, leaving our deficit not much smaller and our economy worse).
Any 10-year prediction of the 'long-term effects' of the tax cuts is pure speculation at this point. As of now, all we can judge the latest tax cut on is its historical performance. Today's announcement showed that the economy grew at a rate not seen in almost two decades. Any financial source will cite the tax cuts as greatly aiding this growth. Wall Street has praised the tax cuts, as evidenced by the market's strong rise over the last few months as the tax cuts took effect. The only data points with which we have to judge the latest tax cuts are the historical data with which we have been provided. This data speaks overwhelmingly in favor of the cuts. Remind me again, what happens when the economy improves? Oh yeah, tax receipts rise. Your argument is utterly destroyed.
It's not so simple. We possibly wouldn't be seeing such a substantial improvement in the economy right now w/o the tax cuts. What type of revenue generation will that create? How much will personal debt be decreased because people pay less in taxes? If you need to borrow money to provide an economic stimilus (so tax revenues increase in future quarters), who pays a lower interest rate, individuals or the Federal government? It's not a simple A => B causal relationship. BTW, when we first started running huge deficits people freaked, and the sky was going to fall in just a few years. Hey, it never did. Doesn't mean that it won't in the future, things can change, but a deficit by itself means little. I would be much more concerned over a stagnating economy and jobs going overseas. If we get some decent job growth, we will have averted the torpedo that can sink the recovery.
Yeah, he definitely thinks that way, but I take exception to the word "destruction." Tax cuts aren't destroying anything, just making the government take in less. If he had merely said it would have reduced public wealth and left it in the private sector that would have made sense to me.
If you used your eyes instead of your ass...umptions, you'd have noted that, on at least 10 occassions, I said that there was no way to blame Bush for the economy. Ask Batman or any of the others with whom I argued about this. I am tired of people assuming that because you see the faults of an administration that must mean that you are a knee-jerk of a critic as they are of a supporter...
Sigh....read response to texx...Which party? The one I voted for in the last election? The one I supported in 5 of the last 6 Presidential elections? Ok...maybe I am biased, but I fail to see how my ususal support for the Republican party would lead me to not want to give Bush credit if it's due... I jusy do not see, and never have, that you can make a direct lkink between short term ecominic action and a President, as most economic stidies I've seen suggest that it takes years to analyze the effects of particular actions...as I said when defending Bush being blamed for the down economy....which one of us seems entrenched now, Cohen?
The fact that so many people are still out of work or have been forced to take much lower-paying jobs will do that for us. The fact that companies are squeezing blood out of turnips (more production, fewer workers) will do that for us. A lot of the recovery was thanks to temporary measures that might not bear up. I don't want a bad economy, I just want to flush this "President."
So uninformed, yet so grandiose. The latest round of tax cuts has yet to be fully implemented, and in fact, won't be completely implemented until 2009. Look it up yourself (I'm not going to do your work for you, as I have countless times). And supply side economics, the refrains of which you parrot here, has been debunked as myth, akin to crop circles and tarot cards. Try again.
I don't believe in judging a President on the current actions of the economy. I do believe in Presidents implementing economic policies intended to bring about long term change as desired, but I don't think you can make that call in the short term. I said this when defending Bush when the economy was spiralling, and now that there is a glimmer of hope, it would be inconsistent to say otherwise, no? Besides, in that this is a relative projection, and that would make it relevant to where we had fallen, it's not even that big of a story yet. But I digress; whether you are a follower of Smith, Keynes, Wagner, etc., all of them suggest that it takes a long term relative evaluation period within which the success or failure of an economic policy can be evaluated...and even then, direct attribution of same to a President is a sketchy process at best, sort of like crediting withc doctors with the weather; so much of what really affect the economy is beyond any President's individual contol.
Yawn...Look farther up the thread, or in many others, and you'll see me criticize Bush and state that his failings in International politics have me looking at Democratic candidates. Is that entrenched? I only have 2 finance degrees, so pardon if I let all of that academic crap get in the way of your reality. Fiscal policy has an impact and although some direct stimulus effects are delayed, as you mentioned, it's not so simplistic is it, or are you? What role does busniess and consumer confidence/forecasts play in economic recovery? I don't give a lot of credit to Bush, and would probably give more to Greenspan, but he does deserve some credit. You will be in a small camp of partisan folk if you believe his policies had zero positive effect on the economy.
I personally don't hold Mr. Bush responsible for the economic downturn in 2000-present, but I DO hold him accountable for his policy to deal with the economy and its reckless consequences. I don't feel that any short-term economic recovery spurred by these tax cuts is worth the long-term risks. I know many people here choose to dig their head in the sand and flat our ignore anything they percieve as coming from a political-biased source and I agree in principle that such information should be examined closely.. Thus I present an article written by "Bob Kerrey, Sam Nunn and Warren B. Rudman are former senators. Peter G. Peterson and Robert E. Rubin are former cabinet secretaries. Paul A. Volcker is former chairman of the Federal Reserve," that appeared in the NY Times http://www.nytimes.com/2003/04/09/opinion/09RUBI.html?ex=1067662800&en=fb305f27fa3e01fc&ei=5070 "...the deficit projections are cause for alarm. A recent study by Goldman Sachs includes this forecast: if the president's proposed new tax cuts are enacted, a Medicare prescription drug benefit is approved, the A.M.T. is adjusted and appropriations grow modestly, the deficits over the next 10 years will total $4.2 trillion — even if the Social Security surplus is included. If it is not included, the deficit would be $6.7 trillion. Under these circumstances, the ratio of publicly held debt to gross domestic product climbs within 10 years to nearly 50 percent, from 33 percent just two years ago. And all of this happens before the fiscal going gets tough. Looming at the end of the decade is a demographic transformation that threatens to swamp the budget and the economy with unfunded benefit promises, like Social Security and Medicare, of roughly $25 trillion in present value. Our children and grandchildren already face unthinkable payroll tax burdens that could go as high as 33 percent to pay for these promised benefits. It is neither fiscally nor morally responsible to give ourselves tax cuts and leave future generations with an even higher tax burden." When will the Republicans start acting like Republicans and become outraged at the fisical irresponsibility shown by Bush and Congress? If you want to cut taxes as much as they did, you HAVE to reduce your spending as well!
I do agree with this post. But what makes us think the government will cut spending under any circumstances? Even when they had huge surpluses in the 1990's they didn't reduce any spending! If Bush didn't "spend" the surpluses through tax cuts, it would have just been spent on pork and big programs.
