SmartMoney: how the the expiration of the Bush tax cuts affects you

How Ironic.

 

There is no class war any longer. It is just Apartheid.

 

That is the stupidest comment i've heard in a long time. We are probably the least racist country in the world. Talk to others experiences in Germany or Spain or Japan or other countries. Its impossible for foreigners to get jobs over nationals.

We have the most opportunities for all minority groups and even companies that promote diversity.

Anyone from rural Alabama, the ghettos in Chicago, Manhattan, or Beverly Hills can go to any school or start up a business if they choose to. There are no laws limiting that. There are significant funds for educational loans and Sallie Mae programs so almost anyone can get funding.

The only constraints on anyone starting up a small business and becoming successful are the over-reaching government regulations on businesses.

 

*******, I demerit myself for getting suckerd in. Usernames like "Rocketman" are way to generic to be remembered, but here's a similar thread that met a similar end with a goofy parable about Munger when caught sans pantalones.

I'm guessing not the first time this dude has been here.

 

Jeebus....beware SamFisher and his madd search skillz yo

 

He wasn't talking about racial apartheid, he was talking about class based apartheid. It really isn't that much of a stretch to say we have class based apartheid in the US today.

 

That was a thread about business and taxes and as is this. And in both threads your ideas were tax, tax & tax!

I would wager that SamFisher, Gladiator, Batman, Rhadman etc. have never owned a business or had to hire and or fire people or even ran a division.

Its like talking about Yao's work ethic and heart from reading box scores and never having watched or played a game of basketball in one's life.

You'll never know what i'm talking about till you run a small business like I do.

 

You would be completely wrong about me, but it isn't like you have ever let facts sway your ideology.

 

What business did you run and what happened to it?

 

Democrats: GOP Is Like Robin Hood - in Reverse

http://www.cbsnews.com/8301-503544_162-20010306-503544.html

Democrats are seizing on comments by Republican Senate Minority Whip John Kyl on Fox News yesterday suggesting he believes the Bush tax cuts for those making more than $200,000 should be extended - and contrasting that position with Republicans' decision to block unemployment insurance extensions for out of work Americans.

The Democratic Senatorial Campaign Committee is spotlighting Kyl's comments in press releases this afternoon. Check out this quote from one such release, tailored to the Illinois Senate race, from DSCC National Press Secretary Deirdre Murphy:

"A top Republican leader in the Senate just telegraphed the Republican playbook: pull out all the stops to help the super wealthy but continue ignoring the middle class. Congressman Mark Kirk should tell Illinois voters if he is going to rubberstamp the out of touch Republican leadership or if he has the courage to help unemployed workers in his state."

Extending the Bush tax cuts, which are set to expire at the end of the year, would cost $678 billion over ten years, according to Fox News' Chris Wallace.

Wallace asked Kyl on "Fox News Sunday": "At a time Republicans are saying that they can't extend unemployment benefits unless you pay for them, tell me, how are you going to pay that $678 billion to keep those Bush tax cuts for the wealthy?"

Responded the Arizona senator: "[Y]ou should never raise taxes in order to cut taxes. Surely Congress has the authority, and it would be right to -- if we decide we want to cut taxes to spur the economy, not to have to raise taxes in order to offset those costs. You do need to offset the cost of increased spending, and that's what Republicans object to. But you should never have to offset cost of a deliberate decision to reduce tax rates on Americans."

White House press secretary Robert Gibbs Tweeted this in response to the comments: "Kyl says wealthy need big Bush tax cuts while middle class families are on their own to fend for themselves as a result of Bush economy."

Hari Sevugan, press secretary for the Democratic National Committee, piled on in a comment to Huffington Post: "If all of this has a familiar ring to it, it's because unpaid for tax cuts for the rich at the expense of working people is the same backward policy Republicans used to put the nation in this hole, and it's the same policy they promise to return to if put in a position of power again."

 

My wife owned an internet retail shop that went gangbusters in 2007 and then went bust in 2008.

In addition, I ran a technology consulting firm until I had to take a full time job because health insurance was too expensive. We were talking about children at the time and being self employed didn't work.

 

By the way, it appears that the biggest impediment to small business expansion is not taxes, as you posit, but the fact that banks aren't lending. This is more evidence that putting more money into the bank accounts of the wealthy is unlikely to have a large impact on our economy.

http://online.wsj.com/article/SB10001424052748704288204575363092389744712.html

Federal Reserve Chairman Ben Bernanke urged banks and regulators Monday to seek out ways to ensure that small businesses get the credit they need to create jobs.

"Making credit accessible to sound small businesses is crucial to our economic recovery and so should be front and center among our current policy challenges," Mr. Bernanke said in prepared remarks to the Fed's forum on restoring credit to small businesses.

Declaring small businesses as "central" to tackling unemployment, the Fed chief said not enough is being done to ensure that financially sound companies can obtain loans.

Fed officials have become increasingly worried about the stubbornly high unemployment. The jobless rate edged down to 9.5% in June from 9.7% the previous month. But the economy shed jobs for the first time this year, with nonfarm payrolls falling 125,000 last month.

"The formation and growth of small businesses depends critically on access to credit," Mr. Bernanke said in the text of his remarks. "Unfortunately, those businesses report that credit conditions remain very difficult."

The forum is the culmination of a fact-finding mission the Fed launched in February to identify how to improve credit access for small firms, which account for about 60% of job creation.

Fed officials have hosted more than 40 meetings around the country with small businesses, bankers and community leaders to identify obstacles that have contributed to a continued contraction in lending.

Mr. Bernanke cited data showing that outstanding loans to small businesses have declined to less than $670 billion in the first quarter of 2010 from about $710 billion in the second quarter of 2008.

While major banks eased loan conditions for big firms during the first quarter, lending standards remained tight among the local banks that small businesses rely on, according to the quarterly Fed survey. Similarly, a survey by the National Federation of Independent Business found that the proportion of firms reporting tighter credit conditions over the past three months remained "extremely elevated," Mr. Bernanke said.

Some lenders participating in the meetings viewed the current lending standards a return to more normal conditions following a period of lax standards. But Mr. Bernanke said "it seems clear" that some creditworthy borrowers and having trouble getting credit, even when strong cash flow is compensating for a loss in collateral.

"The challenge ahead for lenders will be to determine how to assess the credit quality of businesses in an uncertain and difficult economic environment," he said.

Lending to creditworthy borrowers is in their interest, Mr. Bernanke said, since "that's how they earn their profits."

Meanwhile, he said regulators should continue to work with lenders to help improve credit availability to sound small firms.

The Fed has been encouraging banks to ensure that credit-worthy small businesses can get the credit they need. Reacting to complaints that its own bank examiners are contributing to overly tight standards, the central bank is also conducting training programs with examiners to drive home the message that encouraging loans to small businesses that can repay is positive for the banking system.

Still, Mr. Bernanke cautioned against "one-size-fits-all solutions," saying that the meetings confirmed that each small business has a unique combination of local economic conditions and relationships with creditors and customers.

He didn't make any comments on the outlook for monetary policy.

 

I'm 99% sure I'm getting suckered into this thread but I find this (among his many in this thread) to be an example of the type of poorly warranted justification for supply side economics by conservatives.

Exhibit A of a consistent theme of defenders of supply side theories. The very basis of the argument rests on anecdotal stories like this. There's a consistent theme in your posts. You resort to stories and never bother to cite a single statistic or trend.

But then again you're defending supply side economics, which in and of itself is based on the mythical ability to shift the aggregate supply curve with tax cuts. (never bothering to mention that the growth of the 90s corresponded perfectly with the rapid institution of computers and the internet into modern business practices)

I mean the whole rationale for cutting taxes initially was not only was it good for business but it would actually generate tax revenue since the supposed increase in business growth would in turn end up generating more tax receipts. The only problem was that like the whole of supply side theory, the Laffer Curve was just an idea (an idea that he literally scratched up on a napkin).

But I'll bet you've never seen a Laffer Curve with any actual numbers on it. And that's emblematic of everything else in the zone of supply side theory. These are all theoretical positions with little to no math and actual economic analysis to provide some warrant.

Again unjustified anecdote with no evidence or math.

First of all, this just reiterates my point from above. You're operating under a theory with no math. You say that lower taxes are good because it allows companies to reinvest wealth, yet you provide no threshold as to what "low" means or what an optimal tax level even is.

I mean sure in principle that sounds fine and dandy but when we're basing economic policy off of broad logic with no substance, its pretty easy to see how we also end up completely sucking at accounting and start running huge deficits.

So what is all taxation bad then? (at least on corporations)

No its just a fundamental over-simplification of economics. And its the reason why our understanding of economics in this country is becoming ****tier and ****tier when people constantly spew out hypothetical nonsense guised as some sort of sound economic theory.

How this notion of "economics" has gotten this far is beyond me. I mean I know nowadays its fashionable to declare ones support for the "Austrian school" of economics but there was a reason why Austrian economics get laughed off of the academic world. When Keynsian economics first showed up, the Austrian response to the criticisms of the boom and bust cycles of the 1800s and early 1900s (supplied to them with actual numbers and warrants) was to just laugh it off and stress a bunch of bad anecdotes. People were smart enough to laugh off such blatant anti-intellectualism but for whatever reason today, we still embrace it and treat it as fact when nothing has changed.

Less stories, more data. That's all.

 

Not validating anything Rocketman1981 is saying, but there is a pretty significant disconnect between what they teach in Business School/Economics classes and what starting and running a business entails. You can only see that if you have experienced both.

 

No there isnt, he's just consistently conflating the two together.

Knowing how to run a business has nothing to do with macroeconomic policy. Thats why his posts are so annoying he keeps applying anecdotes about running a business and somehow making that a justification for a macroeconomic theory. If storytelling is the basis of our economic policy then we're screwed, bottom line.

As for business schools, if you're going to business school to learn how to run a business then you're going for the wrong reason. The most important element of entrepreneurship is inherent to the person. It takes a certain person with the creativity, communication and innovation to run a successful business. Business school is much more useful in terms of learning about specific niches or learning about things like finance, accounting, etc.. that are completely separate from running a business. (although even those are definitely useful to know)

 

Even former Reagan officials who helped craft Reaganomics aren't against present day tax increases.

Bruce Bartlett, Mr. Supply Side Economics:
[rquoter]Republicans will undoubtedly make extravagant claims about the detrimental economic effect of these higher taxes. When one hears these claims, however, it is worth remembering that they said the same things in years past and none of their dire predictions came to pass.

According to a recent Treasury Department study, Ronald Reagan proposed the largest peacetime tax increase in American history as part of a budget deal to get the federal deficit under control. The Tax Equity and Fiscal Responsibility Act (TEFRA) of 1982 was signed into law on Sept. 3, and most of its provisions took effect on Jan. 1, 1983.

During debate on TEFRA, many conservatives predicted economic disaster. They argued that raising taxes in the midst of a severe recession was exactly the wrong thing to do. "Every school child knows you don't raise taxes in a recession unless you want to make it worse," The Wall Street Journal's editorial page warned. Said Rep. Newt Gingrich, "I think it will make the economy sicker." The Chamber of Commerce of the U.S. said it had "no doubt that it will curb the economic recovery everyone wants."

Looking at the data, however, it is very hard to see any evidence that TEFRA had a negative effect on growth. Indeed, one could easily make a case that its enactment stimulated growth. As one can see, the economy's growth rates after TEFRA took effect were among the fastest in history. (charts in link)[/rquoter]

[rquoter]
In 1993, Bill Clinton proposed another major tax increase. Perhaps because it was initiated by a Democrat, conservatives were even more convinced that it would bring about economic disaster. In an Aug. 3, 1993, media fact sheet, John Goodman of the National Center for Policy Analysis predicted the following results from the higher taxes: Capital formation would be reduced by $1.76 trillion through 1998, 1.34 million fewer jobs would be created and the real GDP growth rate would be 0.4% lower than it otherwise would have been.

An examination of the data, however, shows that this forecast was totally wrong in every respect. The following table shows what happened after the 1993 tax increase was signed into law on Aug. 10. (chart in above link)[/rquoter]

David Stockman, Mr. Starve the Beast... on raising taxes and Starving the Beast:
[rquoter]
I think the lesson of the last 25 years is that [starving the beast] doesn't work. You can keep cutting taxes until you reach the point where this year -- or the year just ended, we spent $3.6 trillion, and we only collected $2.2 trillion.

So, we are now so far out of kilter that it's irrelevant. Taxes are going to have to be raised. And the beast needs to be trimmed back. But it can't be starved enough to even begin to cope with our fiscal problem. And this is where I think all the politicians are faking in both parties, but the Republicans especially.

The Republicans think their mission in life is to cut taxes. Sorry, game -- game over. We're now in the tax-raising business. And we're going to be in the tax-raising business for the next decade.[/rquoter]

 

First of all if you seriously want to encourage small businesses, the federal government is actually one of the worst places to turn to if you want to encourage entrepreneurship.

Rather than fingerpointing at Obama who frankly cant do much when the vast majority of regulations that impact small businesses are at the state level, how about you point the finger at our secessionist tea-party governor who raised the franchise tax and changed its requirements to hit almost every small business in texas. (Or the creation of the state enterprise fund which he took from unemployment insurance money that benefited all small businesses to instead award money to select businesses that many times were campaign donors)

All of this of course to pay for deficits that he created but then again that's easy to ignore because Rick Perry supports tea-partiers and right wing shrill economics.

There's plenty to criticize about our governor and his blatant disregard for small business before you can even start pointing the finger at the federal government.