The one promise that President George W. Bush made during his re-election campaign that made me enthusiastic about voting for him was that he said he would reform Social Security so that people could direct some of their money into private accounts. To this day, I don't know why so many people oppose this--no one has to redirect their Social Security funds, but it's an option.
In the days just after his re-election, he tried to make good on his promise, but the Democrats demagogued the issue, as they tend to do (even Biden did so in the VP debate this year), the public soured, Republicans didn't push, and the whole endeavor died.
The weird thing is, back then, I don't remember anyone saying, "George W. Bush campaigned on this, and he won, therefore we should do it," which seems to be the argument for raising taxes today. In another example of inconsistency (note: I'm not calling this hypocrisy), in 2005, with a Republican President that the left despised, mandates and campaign promises meant nothing. In 2012 with a Democrat President that the left adores, the exact reverse.
Friday, December 14, 2012
Wednesday, December 12, 2012
Tax Cuts for the Wealthy!
When I was an undergrad, many years ago, my friends and I would watch The Simpsons before going to dinner. This being during the 2004 election, we were subjected to scores of political ads. In every Democrat ad, the candidate would complain about the "Bush Tax Cuts for the wealthy." Typical of undergrads, we turned this often repeated claim into a subject of mockery.
Now that the tax cuts are set to expire, it can only be those that help the wealthy that expire, not the ones that benefit the non-wealthy. Now, that I'm older and more knowledgeable, I know that less than 25% of the tax cuts went to the wealthy, and it would be too painful to let them expire for the overwhelming majority of the country.
There are so many ways to look at who benefited the most from the tax cuts, and Democrats have switched descriptions from then until now, and both times they've succeeded. This is one quality I do not have, which suggests I can never be a politician. Of course, if I were a politician, I would try to point this out, how Democrats used to be opposed to these tax cuts, but now they support most of them.
With all this in mind, I read David Henderson's post on the subject, and I decided to find some documentation, so here is what Krugman used to say versus what he says now.
"The Bush tax cuts have, of course, heavily favored the very, very well off." --Bush's Own Goal (08-13-2004)
"Budget office numbers show that most of Mr. Bush's tax cuts went to the best-off 10 percent of families, and more than a third went to the top 1 percent." --Checking the Facts, In Advance (10-12-2004)
"While the central thrust of both the 2001 and the 2003 tax cuts was to cut taxes on the wealthy, the bills also included provisions that provided fairly large tax cuts to some--but only some--middle-income families." --The Sweet Spot (10-17-2003)
"Or consider the 2003 tax cut. It was also heavily tilted toward the affluent." Flags versus Dollars (11-7-2003)
And in this video (around the 7 minute mark), Krugman says most of the tax cuts can survive, "Just a small piece is going to be taken away." Of course he isn't saying it directly, but the implication is that only a "small piece" of the tax cuts went to the very wealthy.
Addendum: It occurs to me another explanation for the switch could be a different definition of rich. Clearly, Obama's definition is $200-250K or more. Maybe Democrats had a lower threshold a decade ago.
Now that the tax cuts are set to expire, it can only be those that help the wealthy that expire, not the ones that benefit the non-wealthy. Now, that I'm older and more knowledgeable, I know that less than 25% of the tax cuts went to the wealthy, and it would be too painful to let them expire for the overwhelming majority of the country.
There are so many ways to look at who benefited the most from the tax cuts, and Democrats have switched descriptions from then until now, and both times they've succeeded. This is one quality I do not have, which suggests I can never be a politician. Of course, if I were a politician, I would try to point this out, how Democrats used to be opposed to these tax cuts, but now they support most of them.
With all this in mind, I read David Henderson's post on the subject, and I decided to find some documentation, so here is what Krugman used to say versus what he says now.
"The Bush tax cuts have, of course, heavily favored the very, very well off." --Bush's Own Goal (08-13-2004)
"Budget office numbers show that most of Mr. Bush's tax cuts went to the best-off 10 percent of families, and more than a third went to the top 1 percent." --Checking the Facts, In Advance (10-12-2004)
"While the central thrust of both the 2001 and the 2003 tax cuts was to cut taxes on the wealthy, the bills also included provisions that provided fairly large tax cuts to some--but only some--middle-income families." --The Sweet Spot (10-17-2003)
"Or consider the 2003 tax cut. It was also heavily tilted toward the affluent." Flags versus Dollars (11-7-2003)
And in this video (around the 7 minute mark), Krugman says most of the tax cuts can survive, "Just a small piece is going to be taken away." Of course he isn't saying it directly, but the implication is that only a "small piece" of the tax cuts went to the very wealthy.
Addendum: It occurs to me another explanation for the switch could be a different definition of rich. Clearly, Obama's definition is $200-250K or more. Maybe Democrats had a lower threshold a decade ago.
Tuesday, December 4, 2012
Questions I Wish the Media Would Ask
"President Obama, in their latest proposal the Republicans have indicated that they're willing to increase revenues by closing loopholes. I realize that you don't think their math checks out, but if they offered $1.6T by closing loopholes that affected only the rich, would you take it?"
This is a hypothetical question such as that asked of Republicans "Would you support a deficit deal overwhelmingly weighted towards spending cuts even if it had some revenue increases?" which Democrats/Liberals love to throw around.
The question is meant to reveal whether President Obama cares about revenues or cares about tax rates. For the life of me, I can't figure out why he is so adamantly in favor of higher tax rates (as opposed to just increased tax revenues). Which he seems to be. "Although Mr. Obama [said] a deal is not possible without an increase to the tax rate for those making over $250,000."
Why?
If it's just because he doesn't think it's possible to extract that much money without raising tax rates on the wealthy, then I don't understand his strategy, he could just say, I want $1.6T in revenues and I don't care how you get it (as long as it comes from people making more than $250,000). Why would he need to add another stipulation?
Anybody have an idea?
This is a hypothetical question such as that asked of Republicans "Would you support a deficit deal overwhelmingly weighted towards spending cuts even if it had some revenue increases?" which Democrats/Liberals love to throw around.
The question is meant to reveal whether President Obama cares about revenues or cares about tax rates. For the life of me, I can't figure out why he is so adamantly in favor of higher tax rates (as opposed to just increased tax revenues). Which he seems to be. "Although Mr. Obama [said] a deal is not possible without an increase to the tax rate for those making over $250,000."
Why?
If it's just because he doesn't think it's possible to extract that much money without raising tax rates on the wealthy, then I don't understand his strategy, he could just say, I want $1.6T in revenues and I don't care how you get it (as long as it comes from people making more than $250,000). Why would he need to add another stipulation?
Anybody have an idea?
Bad Research - Why the Poor Favor Democrats
I'm currently working on my Ph.D., and it's shoddy "research" like this that drives me batty. Granted I haven't read the actual research, only the story about it so maybe the authors are just mentioning the pieces they think the readers want to hear.
They argue that low income voters support Democrats because low income voters prosper when the President is a Democrat. Many commented on the story that we don't know if they included transfers in income or not or really any kind of detail at all. But I think this misses an important point. Past studies have shown that the economy itself does better when the President is a Democrat, which they point out here, too. Additionally, this means high income earners also prosper during Democrat administrations. So by their own logic, shouldn't high income earners vote Democrat? Why don't they.
What would have been more convincing is if they had discussed gains relative to high income earners. As it is, we don't know if low income earners prosperity increases similarly, more than, or less than high income earners in each type of administration. Even though, that analysis itself is probably too simplistic, it's worlds better than the analysis provided.
They argue that low income voters support Democrats because low income voters prosper when the President is a Democrat. Many commented on the story that we don't know if they included transfers in income or not or really any kind of detail at all. But I think this misses an important point. Past studies have shown that the economy itself does better when the President is a Democrat, which they point out here, too. Additionally, this means high income earners also prosper during Democrat administrations. So by their own logic, shouldn't high income earners vote Democrat? Why don't they.
What would have been more convincing is if they had discussed gains relative to high income earners. As it is, we don't know if low income earners prosperity increases similarly, more than, or less than high income earners in each type of administration. Even though, that analysis itself is probably too simplistic, it's worlds better than the analysis provided.
If Libertarians Ran the Media
Then instead of this story being titled "HHS: Obama health law saved seniors $5B on prescription drug costs" it would be titled "Cuts to Medicare Advantage and Wealthy People Pay for More Drugs for Seniors"
Again, the left ignores one of the principles of economics--nothing is free.
Again, the left ignores one of the principles of economics--nothing is free.
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