BPaulsen wrote on 11/05/08 at 19:07:40:


Being an economist by profession, I can assure you that it certainly is not true that "the vast majority of economists are saying that raising the taxes he intends to raise would be suicide right now," still less that it would "collapse the economy."  

The main question about changes in taxes and expenditures is, what is the net effect?  If net government expenditure (expenditure minus taxes) increases, the effect stimulates economic activity.  If net expenditures decrease, in general this depresses activity.  It's all very straightforward.

In what has become standard Republican rhetoric, there is a weird disconnect between taxes and expenditures, under which only taxes are seen as affecting activity, not the sum of the two.  Economic stimulus can only consist of reduced taxes, but not increased expenditure.  This is how people who take this rhetoric seriously come to strange ideas about the absolute fatality of raising taxes.

As to some people having their taxes raised and other people receiving benefits, welcome to political life.  It is precisely the function of politics to determine a host of outcomes that benefit some people and make others worse off, and this has been happening since the stone age.  As for example, when taxes on the wealthy were deeply slashed in the early Bush years, or when the United States invaded Iraq over the vociferous objections of roughly 30% of U.S. citizens whose misgivings turned out to be entirely correct.  There is no primordial, non-political system that cold somehow determine these outcomes, there is only politics.  The idea of a stateless society is a pipe dream: there is always a state, the only question is, in whose interest does it act?  Equally there is no objective fairness, there is only what people believe and what they bring about through political activity.

Personally I consider a society that offers reasonable public housing to its poor; offers heath care and good public education to everyone; and builds a sufficiency of roads, bridges, power lines and ports; to be preferable to one that uses tax dollars instead to line the pockets of political cronies and big corporations while all these other things go to blazes; or insists that twelve aircraft carrier attack groups and three Marine divisions are necessary to its "defense" and then deploys them all aggressively in foreign waters.  But I don't think for a minute that there are objective criteria that can justify one policy or another.  That is why we have elections. 

Judging by the outcome of this election, most Americans believe that progessive taxation is a reasonable and fundamentally fair way to try to ameliorate economic hardship (why wouldn't they? it's been public policy for a hundred years).  So I wouldn't hold my breath waiting for a flat tax.

kylemeister wrote on 11/05/08 at 19:29:11:


Stating Obama's plans are better than McCain's doesn't mean a whole lot. It simply means Obama's wasn't as bad - that doesn't make them good by any stretch of the imagination. In fact, Obama has even lessened his talk about raising taxes, having he himself admitted in an interview with George Stephanopoulos that he realizes they may hurt the economy.

The view on Obama having a better grasp of economics is owed primarily to two things:

#1) McCain being clueless.
#2) Democrats are viewed as stronger on the economy in general.

up and comer wrote on 11/05/08 at 18:37:29:


He's going to raise the corporate tax rate, which will kill employers especially when profits are suffering badly as it is. When you raise taxes the costs get passed on to the consumer, and people get laid off. That's not a good recipe. 


He claims it will only effect a small number of small businesses.

Technically speaking, he is right. That's because most small businesses hardly employ anyone.

Then you look at the small businesses that have under 500 employees (which is technically a small business), the ones employing many people, and they are going to get hit with it.

That's the problem. It's why the vast majority of economists are saying that raising the taxes he intends to raise would be suicide right now, and not pro-growth. It would collapse the economy.

I take issue, as well, with some people getting their taxes raised significantly in order to turn around and hand government checks to people that pay zero income tax as it is. That's straight-up wealth redistribution.

BPaulsen wrote on 11/05/08 at 13:27:53:


the tax increase would be only for people making above 250k, who can easily afford it. He is giving tax cuts to people making less than 250k, even more than McCain was going to.

trw wrote on 11/05/08 at 14:52:49:


The opinion on Bill Clinton being the best president America has had since Eiseinhower is not shared by many people. Most view him as the second best over that time span. There were many things that Clinton did that people didn't like. He only gets the credit he does because he had a huge economic boom (which he did nothing himself to obtain) happen under his presidency.

Bush Senior was not as good as Clinton, but Reagan's legacy far surpasses Clinton's.

Willempie wrote on 11/05/08 at 14:31:19:


Democrats lost the House because Clinton attempted to push us further to the left than the average American cares to go. This country has long been called a right-of-center country. Perhaps that's changing, we'll see.

Clinton's tax policies were a joke that only ended up doing well because of the dot-com boom that happened during his tenure. The only reason the debt was kept under control was because of thousands of new jobs being created in a new industry thereby increasing tax revenues - it had little to do with his tax plans being good by themselves.

The problem with the economy came on a few fronts, none of which had to do with Reaganomics. What they did have to do with was the following:

#1) Corporatism that leads to companies being so large they are overly important, and can't be allowed to fail. If a company is too important to fail, then the free market system can't work. The government shouldn't be involved in ensuring the success of companies.

#2) Deregulation has been blamed when it is in fact government involvement in the markets that caused the problem in the first place. Regulation hampers the ability of new businesses to compete against larger ones, who can meet regulatory standards easier. When there is no competition, you end up with companies that are too important to fail.

#3) Spending is out of control, and too many Republicans are fiscally liberal, which is contrary to the entire GOP brand. That is why Republicans need to tear it down, and get back to their ideals. 

#4) Government growth is out of control. Nowadays the Republicans have become the Democrats in that they too want to expand the government. That is yet another way in which Republicans have strayed off point.

I voted McCain, but obviously he lost.

Given that I will be shipping out in Februrary for the Navy, I wanted someone with relevant experience to be Commander-in-Chief, which Obama plainly lacks. There's other reasons as well, of course, such as Obama's tax plan.

It'll be interesting to see what he does in office. Will he make the same mistakes Bill Clinton made in his first two years that cost the Democrats the House? Will he go ahead with his tax increases when the economy is suffering badly, and unemployment is up?

Interesting times ahead. Americans need to put their shoulder to the grindstone, because in reality it is on us to make things better - just like it has always been.