Note to Fix the Debt: Your Class Interest’s Showing
I guess the Fix the Debt folks are worried that their decades-long quest to roll back the New Deal and lower their own taxes is in peril, because they’re responding now to a Matt Yglesias post which argued they mainly care about rolling back the New Deal and lowering their own taxes. Here’s their non-sequitur-tastic parry to Yglesias’s thrust:
Both Paul Krugman at the New York Times and Matt Yglesias at Slate have made the claim that those who advocate for debt reduction should love the cliff. After all, it does significantly reduce the debt, sending it below 60 percent of GDP by 2022.
We’ve challenged this myth in the past, as the sudden and blunt nature of deficit reduction in the fiscal cliff would have a devastating impact on the economy. It also ignores tax and entitlement reform that could minimize harm and address the future drivers of debt. For these reasons, the fiscal cliff is the second worst option, only behind kicking the can further down the road and not addressing our rising debt.
And here’s Yglesias’s apt response:
So it’s not a group dedicated to avoiding premature austerity at all costs and it’s not a group dedicated to deficit reduction at all costs either. But it does include among its “core principles” that we need to reduce entitlement spending and enact “comprehensive and pro-growth tax reform” that, among other things, “lowers rates.” That sounds a lot like the agenda of a group that’s dedicated to rate-cutting tax reform and entitlement spending cuts, rather than to any particular view about the appropriate timing of deficit reduction.
We’re not quite at the point when it’s wise to say the Fix the Debt folks are flailing, but the prospects of their suffering a near-total defeat are looking better than I could’ve imagined, say, nine months ago. Obama’s been reelected on a fuzzy but pro-soak the rich mandate, and with the cliff fast-approaching it’s looking increasingly likely that we’ll tumble over it (which wouldn’t immediately be that bad) and find ourselves living in the dystopian Hellscape that was the majority of the Bill Clinton 90s. At that point, Obama can sit back and wait for Republicans to reinstate the current tax rates for the 98 percent and, should he so desire, leave it at that.
Worry is, what if Obama’s unwilling to leave it at that? It’s long been something of his White Whale, the Grand Bargain, and there’s reason to think the president is no less committed than before on trading cuts to Social Security, Medicare, and Medicaid for higher revenues from the wealthy. I happen to think David Plouffe’s recent comments at the University of Delaware were intended not so much to make news as to completely troll my Facebook feed; and that Plouffe didn’t say anything we haven’t heard before anyway. But 2011’s debt ceiling-inspired Grand Bargain justifiably casts an ominous shadow into the eyes of any lefty who tries to divine what Obama might do.
My biggest concern isn’t that Obama’s secretly a foe of universal social insurance, but that, like Kevin Drum, he might be think you’ve got to bleed the patient in order to save it. That’s the gist of this Drum post, Why Social Security Reform Would Be Good For Liberals:
If we extended the solvency of Social Security for the next century, it’s true that the Cato Institute would be back the next day complaining that this wasn’t enough.… But the Washington Post wouldn’t. The Pete Peterson folks wouldn’t. The truth is that all the earnest, centrist, Very Serious People who want to reform Social Security don’t want to starve your granny. They don’t have a problem with the concept of a guaranteed retirement program. They just want it to be properly funded. So a deal would shut them up.
As you’d guess, I’m extremely skeptical of this proposition. It seems to me that the idea of the welfare state as simply unaffordable and even passé — best exemplified by Walter Russell Mead’s “blue social model” campaign — has become pretty influential among the Very Serious People. We’ll just microfinance our way to social and economic justice, or something! What about Kickstarter? Do they do disability aid? And as Digby has pointed out on multiple occasions, this kind of “get it off the table” logic brought us welfare reform. And that’s not a precedent to look on with a smile.
Isn’t it just amazing how these jackasses can redefine their way to victory, a-la Welfare Reform? How ’bout Alternative Minimum Tax? There’s a real winner for yez.
The bigger driving equation to sound fiscal policy might ask “How can we intelligently fund this government?” The driver isn’t tax rates or expenditures, it’s revenue. When the economy’s doing well, we always collect more taxes. Jiggering the tax forms and plugging up a few deductions and cutting a few pence from some programs here and there is just so much magician’s patter. When Social Security was put together, it looked nothing like it does today. Today’s brisk deficit hawk is tomorrow’s sleazy pedlar of government largesse.
The very idea that this government can run up these Brobdingnagian deficits and just push it along defies reason. Our capitalist system is utterly dependent on maintaining the accounting fiction of fractional reserve banking. The system only works because it’s heavily regulated. Whatever the Austrians may think about the conspiratorial and fraudulent nature of fractional reserve banking, the only way it could possibly work is by dint of constant regulation. But when government itself can float all this debt, who regulates that polite fiction? What’s the difference between a government which cannot or will not regulate itself and an unregulated bank? None that I can see, folks.
The Bank of Kabul collapsed some while back. Seems all that bank ever did was enrich Karzai’s cronies, turning American aid to Afghanistan into private fortunes. We’re running a war there, supposedly fighting the backward and intolerantly Islamic Taliban. Costs us a ton of money every day. Do you know why the Taliban is so widely admired and accepted in Afghanistan and Pakistan? Because they’re not corrupt. You’d think the one thing America would keep its eyes on would be that bank, proof that we can at least provide sufficient fiscal oversight for one goddamn bank. And we can’t even manage that.
Things don’t look good. The last deficit wrangle dinged our credit rating pretty badly. Another will kick the wind out of this modest little recovery.Report
Excellent.Report
When you say White Wale, are you referring to the caucasian version of the hip hop artist Wale?Report
Yes.Report
Isn’t that just Remy?Report
Works either way for me.
No one is entirely sure which way this will go. The only certainty is that it will be both a massive overreach and a tremendous sell out.
Good work as always.Report
So what else is new Pierre DuPont went all in for the repeal of prohibition because he thought the additional revenue would result in the income tax and estate tax going away. See Last Call. So once again the move to move the taxes to the little guy, nothing new under the sun.Report
The lie is simple: a.) we are spending an unaffordable amount on poor people b.) and borrowing the money from China, c.) soon we will be Greece, so d.) we need to lower spending immediately.
The truth is:
A.) We should be spending more on more people to create equality of opportunity. This will have long term benefits. A strong middle class is necessary to keep the country on top. (See GI bill, New Deal, etc.) If we spend too much it is on the military. And we have taxed too little for far too long.
B.) A majority of treasuries are sold to Americans, often rich Americans, (or at least upper-middle class Americans, and pensions,) instead of taxing them. (China is selling it’s treasuries) http://www.guardian.co.uk/news/datablog/2011/jul/15/us-debt-how-big-who-owns. If taxes had been at proper levels for decades (thanks Bush and Reagan!), we would have far less debt and the rich would own fewer treasuries.
C.) We will never be Greece because we control our own dollars. Greece was corrupt and poor it’s finances were ruined -after being temporally artificially inflated- by a disastrous financial union.
D.) Austerity policies around the world are killing growth. We should wait until the economy is growing to cut anything or even to raise taxes. We should be borrowing more (at record low rates) for more stimulus spending. We shouldn’t even discuss cuts for a year.Report
Just to play devil’s advocate:
A. There will never be equality of opportunity. It’s not feasible. A better discussion might be what level of inequality is acceptable.
B. Purchase of T-bills ensures repatriation at some point. Or purchase of oil.
C. Were this argument sound, then the last few rounds of QE would have been a wondrous success.
D. Could be more that conditions precedent run counter to austerity and require some amount of time to adjust. The stimulus here didn’t seem to be very effective, and there’s no indication that any more would be effective. Too much liquidity in the system for starters, and inelasticity issues. Revenue increases could be targeted, perhaps more incentives introduced, to encourage more economic activity.Report
QE is less effective because we have reached the lower bound (0, basically) for interest rates. QE is designed to lower interest rates. (Hard to go below 0.) Bernanke has been too slow and too cautious to engage in more creative methods as he encouraged the Japanese to do before he was Chairman. In Bernanke’s defense, he is probably right that fiscal spending by the gov’t would be more effective stimulus than QE.
Perfect equality of opportunity is miles from where the U.S. is at. We are trailing the world on that score.
The stimulus was effective and we are greatly outperforming Europe’s disastrous austerity and financial madness. (The northern Europeans who stayed out of the Euro are doing well enough, too. The Aussies. The Canadians.)Report
QE sure put some pep back in the stock market. That was wondrous. It’s not so good for strip-dependent investments such as pension funds but then, those funds can go off in search of other investments in the marketplace, not such a bad thing when we consider how the same people who now complain about QE were the same people who were running the same scheme with Freddie and Fannie back in the day.Report
More like a sugar rush is the way I call it.
Kinetic energy stored away.Report
We sorta have to dissect what was done with the various rounds of QE before we can call such schemes a sugar rush. I do get your point, advocatus diaboli, something had to be done and Greenspan had been plying the markets with ever-lower interest rates for a longlong time. QE was the only tool left in the shed.
But to your point at D: Bernanke’s been keeping an eye on liquidity, that’s probably what keeps him up at night. As I understand it, Bernanke tuned the size of the various QEs to what he could control, to the consternation of some people who wanted larger stimuli. I’m sure I don’t have to tell you a badly managed QE is a dangerous move because it can prolong a recession, rather like those dubious cold medications only mask the symptoms of a cold. But they do get you out of bed and get something done. And they’re more effective in repeated small doses.Report
What really concerns me is the amassing of cash reserves and dividend increases rather than capital expenditures.
I haven’t been watching it for awhile, and so that information might be somewhat dated.
But still, it suggests that further QE would be less effective than direct stimulus.
Which brings to mind military spending.
That most of that goes to American companies and American workers seems to be oft-overlooked.
Surely the money could go to other industries, with much caterwauling, but I’m not so sure it could be targeted domestically in the same manner.Report
Heh, heh. Have you seen the recent huffing and puffing about the Chinese finally landing a knockoff Russian jet on an old Ukrainian carrier? Gotta read Chris Kelly on this. It’s too funny.Report
Large portions of military spending redirected to infrastructure spending would remain in America. Getting our roads, bridges and transit out of the 1960’s and into the twenty first century would do a world of good for our economy to boot. A modern, stable electrical grid would mean more to the nation’s general security than a new class of submarines.Report
Submarines are capital expenditures.
I was thinking more of less durable items; all the high-end gadgets coming out of McDonnell-Douglass in St. Louis and Rockwell Collins in Cedar Rapids, and all the manufacturing jobs that go into making those things.
The US is a huge exporter of traditional munitions, but the really high-end stuff stays around here, for the most part.
A big part of defense contracts are reserved for minority-owned small business, for example.
There’s a lot more to it that a simple armament build-up.Report
I didn’t mean to imply it was just about building up armaments, but rather I was addressing your point about defense money going to other industries, with much caterwauling, with commensurate loss to American companies and workers.
All those manufacturing jobs producing high-end gadgets designed to kill people with greater efficiency could be jobs producing high-end gadgets designed to facilitate power grids with greater efficiency. The state of our national infrastructure puts the US at a huge competitive disadvantage and highway construction jobs can’t be outsourced to India. National or regional infrastructure contracts could be reserved for minority-owned small US businesses just as easily as defense contracts are now.
My point is I think you are overselling defense spending as an unusually effective domestic economic engine. Infrastructure improvement would be just as effective and our country needs state of the art transit and power systems much more that it need state of the art munitions and power-projection in Southeast Asia.Report
“We should be spending more on more people to create equality of opportunity”
How much more should we spend and on what should the extra money be spent to create what type of equality of opportunity?Report
Whatever amount of money that needs to be spent to make libertarian white men think they’ve lost their freedom.Report
In other words, you have no idea — just posturing.Report
Freedom’s just another word for a lower marginal tax rate.Report
Copy Sweden.
Maybe Denmark or Canada or Germany or France.
Am willing to negotiate all the details, but that gives you a rough idea.
Mostly just enact socialized medicine or socialized health insurance (saving money). Increase SS benefits by 5%. Increase transfer payments to states to help with tuition on a European”free college” level. End the war on drugs and reduce prison spending drastically by reducing sentences. Increase minimum wage to 13 dollars. Reduce military spending 20%.
It’s a long list and the details are negotiable.
I am also a big believer in incremental change, phased in so as to see what works and make changes on the fly.
I’d start with the stimulus policies here to stimulate the economy: http://www.nybooks.com/articles/archives/2012/may/24/how-end-depression/?pagination=false
After the economy is growing, I’d return tax rates to Clinton-era levels and institute medicare for everyone over 55. I’d cap deductions at 50,ooo and institute the Buffett Rule. (Also lower the corporate rate while killing corporate deductions to compensate.) I’d lower military spending 3%. I’d institute the small changes mentioned in that Drum article to just keep SS stable. I’d end the drug war. And double spending on pell grants.
I’m not able to do the math to see if that adds up to balance the budget, so we could just start with the budget here and adjust over time:
Or you could do this as a start:
http://cpc.grijalva.house.gov/index.cfm?sectionid=70§iontree=5,70
And then over time move to a more European level of taxation and spending, over a long period, especially to make college nearly free or free.
I doubt any of this will happen, so I hope we can at least prevent moves in the opposite direction.Report
Before the leader copies the followers, and the US emulates Sweden or France, I suggest we listen to Kip Hagopian….
“America’s economy has outperformed all other industrialized nations. The vast majority of Americans have fared well over the period of the cbo study. In fact, the U.S. economy has been the best-performing large economy in the world as measured by per-capita gdp and median standard of living. According to the oecd, per-capita gdp in the U.S. in 2010 was $46,600, which is 47 percent higher than the $31,800 average per-capita gdp in the eu nations in that year.
In addition to substantially higher gdp per capita, the U.S. has a significantly higher standard of living than almost all of the most advanced economies. According to “The Luxembourg Wealth Study,” the data source used by the oecd for international comparisons, in 2002 (the latest year for which results were available), median disposable personal income in the U.S., adjusted to reflect purchasing power parity, was 19.3 percent higher than in Canada; 68 percent higher than in Finland; 45 percent higher than in Germany; 59 percent higher than in Italy; 31 percent higher than in Norway; 73 percent higher than in Sweden; and 31 percent higher than in the United Kingdom.
The figures for gdp per capita and median income understate America’s economic performance advantage because the median age of the U.S. population (36.8 years) is about four years lower than the average median age in the European Union and almost eight years lower than in Japan. Age, as a proxy for experience, is a significant contributor to income until individual earnings peak sometime between age 50 and 55. In addition to higher median incomes, Americans also have higher median net worth, a further contributor to the difference in standards of living.
On a per-capita basis, the U.S. once again outperformed, albeit by a smaller margin. During the comparable period, real compound annual gdp per-capita growth in the U.S. was 2.1 percent, higher than the 1.8 percent weighted average growth of other members of the g-7. Again using per-capita numbers, in 2009 the U.S. economy contracted about 4.3 percent, which was less than the 5.1 percent contraction recorded by the other g-7 members. And in 2010, the U.S. economy grew 2.1 percent, 31 percent higher than the 1.6 percent growth of non-U.S. g-7 countries.
Further evidence of the superior economic performance of the U.S. economy comes from a comparison of unemployment rates. The average unemployment rate in the United States from 1982 to 2007 was 6.0 percent, compared with 9.0 percent in France, 8.3 percent in Germany, and 7.7 percent in the United Kingdom.”
I don’t actually disagree with all of Shazbot’s suggestions, but the Gold Medalists shouldn’t abandon their strategy because someone tells them bronze is prettierReport
Right off the top of my head, I would say:
primary education, small-scale public housing to avoid ghetto-izing, drug treatment programs, and programs to address homelessness which are geared more toward eradicating the cause than giving them a meal and a bed for the night.
I think it’s really a sad statement that we should have so many homeless in so prosperous a nation.
It seems to be the American Way: Devote more time and energy on helping the middle class to attain more trinkets and toys to keep up with the Joneses rather than helping people up out of the gutter.Report
I agree it’s a disgrace to have so many homeless in the City on the Hill and the remedies you suggest.
I’d just add that equality of opportunity is not just about shoring up the poor or even building up the middle class. It’s removing the skewed rules that make the rich immune to failure.Report
Let’s turn the question around and ask you what Opportunity might mean from your side of the fence. Opportunity implies chance. Something unpredictable is in play with opportunity. Not everyone gets an opportunity.
Opportunity is a euphemism. We hear it all the time from people who want to tell us Opportunity is a good thing, which it is. But not everyone will get an opportunity. That part never troubles the euphemism mongers. This Equality of Opportunity business means we can increase the number of people who get a chance. If more people get those chances, more people can succeed. Granted, not everyone will succeed, given a chance. But is it worthwhile to create those chances?Report
I think that was a pretty ungenerous reading of Drum. His argument was that SS is just barely, barely out of balance, and we could fix that with a few tweaks. And, in so doing, we would take it of the political table, and prevent it from being lumped in with MediCare (which is a serious long-term problem).
MediCare we’ll have to deal with. Given the rates of medical inflation since the 70s, it could come to swallow the Federal budget. If the rest of the developed world can provide decent medical care to all its citizens for less than we already spend providing care to 35% of ours, perhaps we need to seriously consider the way that medical care is organized, paid for, incented, and delivered.
If we could assume that the inflation rate of medical care matched that of the rest of the economy into the future, we’d have a pretty managable situation.Report
THAT”S WHAT OBAMACARE IS ALREADY DOING!!!!
Sorry, fee for service is on its way out (to be replaced with the more difficult to calculate “fee per patient”).Report
Social Security is only “solvent” if you believe the fiction that all the IOU’s in it are legitimate. Unfortunately those IOU’s are backed by other IOU’s, which are backed by still more IOU’s. Now when folks on SS receive IOU’s in the mail is when the brown stinky stuff hits the fan. Not possible? Ask those in Kalifornia who have received IOU’s in lieu of state tax refunds.
There will be a major fiscal catastrophe, it was predicted long ago by people living in abject ignorance and poverty compared to today. No one will believe it even as it hits.
Shaz, you need to bone up on Quantitative Easing When you say “Rich Americans” are buying treasuries you should change that to “Rich American Banks”.
What the Fed is: A consortium of 2000+ member banks. What the Fed isn’t: An arm of the Federal government.Report
I think there’s a reasonably good chance that US treasury securities will be paid.
If SS were a private pension fund full of treasuries, everybody would think it was solid for as long as the notes lasted. In fact, they’d probably get needled for being overly conservative. But make it a government program and suddenly there’s all sorts of nonsense about “owing money to yourself” or “raiding the fund” or solvency.Report
Cog dis up the ‘zoo: Kids keep voting Dem tho polls say they think SS won’t be there for them. Older folks vote Rep in hope of saving SS for the kids.
This is why Yglasias, et al., are wrongwrongwrong here, alleging the rich old folks are voting against tax increases on themselves. It’s a slander against some very good and fine Americans, Simpson, Bowles, Judd and Rendell, the top names on the “Fix the Debt” masthead. Attacking them is wrong exactly where Mitt Romney was wrong about a “47 percent” voting only to feather their own beds with gov’t handouts.
No, almost all of us are voting in good faith for what we think will be best for our fellow Americans, and for our country, not ourselves.
There’s nothing the matter with Kansas, or Compton, or America. It would be a tragedy if it weren’t so downright beautiful.
http://en.wikipedia.org/wiki/The_Gift_of_the_MagiReport
Debt service is a de facto tax increase.Report
Lots of people think SS won’t be there for them because lots of pols and radio blowhards are lying at lightspeed to make the kids scared so they can justify privatizing SS.
There are a bunch of small fixes to SS that would solve the problem. The info is cleverly hidden in the report the SS commission puts out every year.Report
+1. SS is only in real trouble is if we go into an economic tailspin in which SS will be the least of our problems. Otherwise, SS is fine with some small tweaks like raising the FICA cap and maybe moving to CPI-Chained inflation rate to determine COLA increases.Report
Yes. Almost all of you.
The motherfuckers are against the ADA, against Veterans Benefits, pro-Slavery, pro debt slavery.
But naturally you’re just voting in lockstep with the motherfuckers, you aren’t one yourself.Report
Frog, the problems happen when the US can no longer sell those treasuries. That time has almost snuck up on us. Right now, the Chinese and Japanese have drastically slowed down their purchase of new treasuries. This slack has been picked up by QE (1,2,3), meaning the banks create the money then lend it to the gov’t through the pretense of buying something, which goes back on deposit at the banks. At some point this game of musical chairs fails, exactly when the music stops coincidentally.
As long as this country is bringing in X in revenues and spending X*Y, Y is a problem. Right now we “borrow” to make up the Y (currently almost 45% of every dollar spent). Now if interest rates were to suddenly spike, which can happen for lots of reasons like a big shooting war we didn’t start but can’t avoid the gov’t would have to decide which things were “real” enough to spend the “real” revenue on and would have to leave out the borrowed expenses. Which do you think they’d cut?
Put another way, those IOU’s are only good to the extent that /new/ IOU’s get honored. In point of fact, an insurance company would only hold Treasuries as an alternative to cash, and a pretty poor one at that.Report
Conservatives have been saying, “OMG, people are going to stop buying Treasuries since 1/20/09.” Also, foreign purchases only make up a relatively small chunk of T-Bill purchases, with the rest made up of American’s who still believe in America and don’t think we should hand over vital social services to Wellpoint, Wall Street, and Wal Mart quite yet.Report
But Jesse, shouldn’t we pay attention to what The Market is saying about Treasury Bills in its wise and infallible determination of their True Price?
Surely, Wardsmith can’t be alone in the knowledge that Treasury Bills are worthless scraps of paper; The Wise Men who Create Jobs must also know this, and be shedding them like leprosy-infected blankets.Report
Breton Woods II is over. This is NOT a good thing.
Nobody fucking writes about this, not the doomsayers on the right or left.
Fuck y’all for not paying attention to the important shit.
and, ward, show me some graphs on Canadian Treasuries. Show me the market fucking choosing a different reserve currency. Throw down, or get the fuck out.Report
I just don’t understand this cavalier attitude toward SS and the unfunded liabilities that entitlements represent that threaten to do real harm to real people. You all act as if this is a political game with no real consequences. It’s mind-boggling.Report
I don’t see the cavalier attitude. SS does need a fix. The SS commission listed a bunch of options to pick from that will take care of the predicted short fall. It can be fixed and without raising the retirement age which would hurt a lot of poorer and working class folk. To much demagoguery has clouded the issue and to many on one side want to cripple or eliminate the program.Report
Durbin and pelosi and Reid and most of the Democrats are saying that SS doesn’t add a penny to the debt, and of course you don’t see the cavalier attitude, of course you don’t. It’s something I made up, just don’t pay attention to the comments, or the reality of baby boomers and extended life expectancy — easy fix, no problem, nothing cavalier at all about that,Report
At one time there was intelligent conversation here but now it’s mainly progressive snark and propaganda. There are very few serious thinkers here.Report
You want a serious thought?
End the tax deduction for second homes.
There, social security dilemma solved.
Simple, ain’t it?Report
Mike-Here is a link to a Kevin Drum post where he explains the idea that SS fix is fairly simple and has a chart from the SS commission. Anything i wrote would be much less clear and, anyway, i’m lazy so its easier just to link.
http://www.motherjones.com/kevin-drum/2011/09/some-gutsy-talk-social-securityReport
And I don’t understand the panic. It’s not as though the data is unavailable. The retirement of the boomers isn’t a surprise. It was part of the plan in running up the surplus.
I suppose part of the problem is that people roll Social Security into another program called SocialSecurityMedicareMedicaid or something similar. They’re not the same thing. Go after Medicare and Medicaid as unsustainable. That’s actually true. But Social Security has been pretty sensibly run up to this point, and its problems are relatively bland, so I don’t see a reason to panic.Report
Our leftish friends now believe in the US of America when it comes to the nat’l debt. This is a small comfort—but a real one, perhaps a common ground to build upon, truly.
For centuries they used to say there will always be an England. They don’t say that so much anymore. Hence my trepidation.Report
The problem is that they are the same people clapping when Obama berated Bush in 2007 about the debt Bush amassed. It’s a game to them.Report
No, debt to finance corporate welfare giveaways, wars, and unfunded tax cuts is bad. Debt to finance health care for all and basic welfare is a good, especially when we can borrow at zero interest.Report
Candidate Obama called Bush “unpatriotic” for the deficit, M. Farmer. It’s an absurdity.
True story. It’s not even funny or a gotcha anymore.
http://www.youtube.com/watch?v=zUPZJDBJI84
It is what it is.Report
So if R pols have called O various bad names i’m sure you would be all over it with youtube vids and indignation, instead of venting your spleen on this. haha i make myself laugh.Report
We knew where Bush’s loyalties were, all the time. Bush43 inherited a surplus upon entering office. CBO estimates, rosy as always, then projected even bigger surpluses, which might have been applied to paying down much of the outstanding debt on the books.
But what did Bush do? He lowered taxes, then borrowed for his wars. Domestic spending wasn’t the driver for his deficits, it was his wars and his tax cuts. Patriotism is one of those weird emotions, like the morons wearing their sports teams’ jerseys. It’s usually nothing but a harmless, vicarious pleasure, patriotism. But when a sitting president cuts taxes and simultaneously borrows for his wars, that’s not good for a country, anyone’s country.Report
President Obama’s two rounds of stimulus money weren’t the great evil advertised at the time. They seem to have had some good effects. The unemployment trend did bottom out. It wasn’t perfect, no legislation of that scope and magnitude could possibly be perfect. But when we look at Bush’s tax cuts — did they do anything for the economy? They were a great cure for a problem we didn’t have at the time they were passed. Likewise, the Bush era deficit spending on bullshit wars were a mighty boon for some sectors of the American economy.
Arguably, Bush didn’t create the 2008 mess, but about 18 trillion dollars were quantitatively eased off this planet and into the sun in his era. The culture of deregulation, which Bush did nothing to address, that created the mess we’re in.
But thanks to Bush and the GOP which wanted those tax cuts, Obama’s now benefiting from lower taxes on the middle class, exactly the cure for the problem we’ve had since Bush blew up the economy. And like Bush, Obama resorted to deficit spending. Don’t ever say Bush43 didn’t do anything for you, folks. He just did it one administration too early.
Bush must not have been paying attention at Biz School, or maybe he was holding the economics textbook upside down: government is the buyer of last resort, not the first. Deficit spending and low taxes are how you get Out of a recession once you’re In that recession. Such tactics are Bad when times are reasonably Good. Well, maybe those times weren’t so good, what with the entire proposition based on bank chicanery and wild speculation. Bush wasn’t much of a student of history, either: empires go broke fighting wars with borrowed money. And oh, when you do fight wars, do try to tell the truth about those wars, at least to yourself?Report
Good Gawd, Bush failed to regulate? Nothing like repeating lies again and again until they become the truth (for leftists). Also if you’re keeping score you’ll recall that the fine woman Brooksley who warned about the impending doom of the CDO’s et al was serving under the CLINTON administration also. But why let facts get in the way of a good narrative?
The crash of 2008 has Clinton’s fingerprints all over it. That’s the problem with economics, bad things take a while to fester until the boil pops, usually under someone else’s watch. But again, I’m only preaching to those with enough intelligence to follow simple math, which excludes those like Kim1, who will no doubt rebut with her usual profanity in lieu of intelligent discourse. Too bad about this site, Farmer is right.Report
You know, Ward, you used to leave comments that had real content in them, minus insults.
Now you can’t seem to have a comment without a eye-thumbing in there, somewhere.Report
Perhaps I’ve heard just one too many “Fu’s” out of the commentariat. You’ll note I don’t participate much anymore, and with reason. This site has indeed changed and not for the better. I note that you’ve NEVER reprimanded Kim for her loathsome behavior, for example here or here. Libs get a permanent pass on this site, I get it. Time to move on to greener pastures.Report
You’re kidding me… you seriously take Kim seriously?
Note: she was bitching at Liberal With An Attitude, there, in your first link. Kim is an equal opportunity flinger of invective.
Really, Ward, if “Kimmie” is your poster-child for “leftists” on this site, you’re seriously paying too much attention to the least credible contributor to the commentariat, and not enough to the other people who you smear when you say things like, “Nothing like repeating lies again and again until they become the truth (for leftists).”
They vastly outnumber her. And for more than the most part, they argue forcefully and honestly. If they’re incorrect, it’s usually because they’re misinformed, not spreading propaganda. And you’re avoiding challenging them with honest arguments, and encouraging them to ignore you the way they mostly ignore Kimmie, for the same reason.
You get into the site what you bring. You’re not bringing it any more.Report
Does the truth hurt, wardsmith?
Well, let it lie out in the sunlight.
“we could wish you humble
and under a ledge,
with a mind that burns
through the skull’s thin edge.
better so, in the sleety rain
than plump and cozy in belly and brain”
To afflict the comfortable and comfort the needy.
If my words do only that, I shall be content.Report
“I get it. Time to move on to greener pastures.”
I feel ya, brother. This place is devolving quickly. I’ve always respected Elias — I know where he stands, but many commenters are killing the spirit of openness, and some like Kim are just a pain in ass on a too regular basis.Report
Ward,
You’ll not find me on the side of the irrational often, I suspect. Once burned twice shy and all that. Clinton Deregulated, Bush did as well (or if you’d rather, we can talk about letting the credit card companies write our bankruptcy laws, and what a mess that turned into). I can say a pretty piece about propping up a market bubbly to the point of flatulence, with our fine stimulus. Ahh, well, at least that last one was the Republican’s fault, and not Obama’s.
My vote was for Obama over Hillary. Because nobody in Goldmann’s books needs to be president anytime soon.Report
Kim:
You could very well do to make your points without using profanity, Ward’s right on that score.
It’s one thing to lose your temper from time to time, it’s another thing to drop f-bombs here and there.Report
Aren’t you against Keynesian stimulus? Isn’t that EXACTLY what Ryan/Bush argued for in 2001 or so? Check deLong if you don’t believe me, he’s got the congressional records pulled.Report
Running deficits during a boom can be bad policy, and bad policy to benefit a few rich peers would be unpatriotic.
I’d say that’s a bit too strong language. Bush was incompetent, not unpatriotic.Report
You start out well enough, saying benefiting a few rich peers is unpatriotic. But isn’t that exactly what Bush did?Report
Clinton left a recession behind too. Ooops. Memory hole.Report
My memory is rather better than that. So is Clinton’s memory. We may thank Robert Rubin for that recession. As I recall, it was Rubin who advocated the reappointment of Alan Greenspan and demolished all those regulations over at CFTC. But ultimately, we must blame Clinton himself, buying into all that fatuous nonsense about the Community Reinvestment Act. Here’s Clinton admitting as much.Report
A few questions:
1) What timeline do you have in mind?
2) What’s your data?
3) Are you going to make a killing when it happens?Report
Well y’know, being the giving liberal that I am, if anyone here has some of those worthless IOU Treasury Bills hanging around, I could be persuaded to take them off your hands.Report
Invisible bond vigilantes are about as worrisome as invisible Bond villains.Report
Indeed, a massive sell off of bonds might not be all bad:
http://www.businessinsider.com/krugman-dont-fear-the-bond-vigilantes-2012-11
—
The long term deficit is a medium-sized problem. The main driver is healthcare costs. (And the military, on which we spend more than everyone else in the universe except Ming the Merciless and the Cylons.) Those same healthcare costs pose a monstrous problems for individuals, too. They are the real problem, not the deficit.
Institute Canada-Care and the problem goes away. The relatively free market we have in healthcare is the deficit problem.
http://online.wsj.com/article/SB124234365947221489.htmlReport
Barry keeps talking about the rich paying their fair share. Has anyone ever figured out what that actually is?Report
Ayup. The same share that everyone else pays. Fairness you see.
0% tax rates ought to be fucking illegal.Report
So legally working with an accountant or tax attorney to pay the least amount of taxes should be illegal? Or do you believe like crazy uncle Biden that paying more in taxes is patriotic? For what it is worth, I think we should have a flat tax, I mean we are all equal here, right?Report
1) I myself have taken advantage of 0% tax rates. You may thank your lucky bushites that I did so. Pardon me, I seem to have lost my talent for insults involving our Presidents.
2) Where did I say that R did anything legal to achieve such a tax rate?
3) I do indeed believe that paying more in taxes is patriotic, at least for the time that we are in a war we cannot afford, fighting to bring in black gold for those who are already rich.Report
Its funny how self-sacrifice is patriotic, except when it comes to money.Report
I’d be more willing to sacrifice if I didn’t think the gov’t would waste my money. Do you really trust the gov’t with your money?Report
Isn’t that the entire purpose of a government run by the People?
That we tax ourselves, and decide how to spend it?
Sure, it is rightful and reasonable to demand that the government use the People’s money wisely; but thats not really what we are talking about here, is it?
The anti-tax people mentioned in the OP are not trying to get more efficient use of their money- they just want to pay less, full stop.Report
Trust but verify, Scott.
I trust the Government with my money a HELL of a lot farther than I trust Verizon.
You see, when I file an FCC complaint, the deputy whats-his-name gets off his duff and does something.
When I file a “My phone’s not working” with Verizon, they cancel it, send someone out to fix the line (leaves without having confirmed it was working) cancel it again (twice), and in general it takes an entire week to get new copper where it’s needed.
One place is giving me decent service. The other has an institutionalized policy to skimp on service, and in general punish me for things outside my control.Report
Kim,
The problem with your response is that you responded to a preprogrammed platitude with a reasoned argument. Scott’s just going to run from this; facts are anathema to trolls.Report
da, so, I play to the crowd, comrade.
Every time I respond with charity and mercy, I get three Triforce Points!
Soon, I shall win Cultural Victory!
*insert the dumbly bears song from Civ*Report
Here’s an idea. You want to go back to the 1950s on social issues, let’s go back to the 1950s tax rates. They were plenty fair in 1950.Report
Heh, good response. Of course it’s the worst of both worlds from my perspective. 😉Report
Pretty sure MA cadged that from Tom the Dancing BugReport
The only thing wrong with that comic strip is that it’s never actually funny.
Although it’s not as bad as Mallard Fillmore.Report
That’s true. But some of us enjoy a little arch humour from time to time.Report
I wasn’t being fair. TTDB is at least intelligent. Mallard Fillmore is a cartoon written by a guy like our beloved commenter Scott.Report
TTDB can be funny, but mostly when non-political now (ex., there’s almost always at least some gold in those ‘Super-Fun-Pak Comix’ compilations of short single strips).
But Bolling has gotten more and more political over recent years, and (to me) correspondingly less and less funny.
I don’t think it’s anything to do with his own politics per se; it’s just hard to make political humor funny; harder still when you are writing about things that upset you personally. This applies equally to left or right wing.
Political comedy is just hard. Colbert cracks me up, but that is because he’s an incredible performer with a great writing staff, and a good chunk of the humor comes at least as much from the “idiotic self-important blowhard” persona (see also: McNeil, Bill) than from any particular political view he is lampooning. Lewis Black is pretty good, partially because both sides can get him riled up (and I haven’t watched in a while but South Park could often pull this off too).
I really liked “Bloom County” a lot back in the day, but the political satire there was mostly pretty gentle and absurd. O’Rourke used to be all right but he lost it a long time ago.Report
Never seen that comic before, Blaise, but it’s interesting.Report
Oh, okay. It just struck me as you wrote it, “Heh, didn’t I just see that same argument on TTDB?”Report
I seem to recall reading a quote to the effect that both liberals and conservatives are in love with the 1950’s.
Except that liberals want to go to work there, and conservatives want to go home there.Report
If Barry could give us a growing economy like the 50’s folks might not mind higher taxes. Wasn’t fixing the economy part hope and change he promised? The question is silly anyway bc those days are past.Report
This is your classiest comment today. jus’ sayin, man.Report
http://www.google.com/publicdata/explore?ds=z1ebjpgk2654c1_&met_y=unemployment_rate&idim=country:US&fdim_y=seasonality:S&dl=en&hl=en&q=unemployment+rates+us
Economic improvement is happening; it doesn’t happen overnight. Unemployment’s back to where it was most of Reagan’s term and falling.
Meanwhile, historically speaking lower top marginal tax rates have coincided with weaker, not stronger, economic growth. The idea that “tax cuts lead to economic growth” is a trope of the right wing repeated so often that it can only be attributed to a Big Lie strategem.
Now, please come back when you have something to say that’s remotely based in reality.Report
Note: this is not what bonddad says.
Calculated Risk, otoh, says we’ve hit bottom on housing. Hope yet, somewhere out in the murky future.Report
MA:
“Unemployment’s back to where it was most of Reagan’s term and falling.”
Really, that is the best thing you can tell folks who are still unemployed after 4 years of Barrynomics? Unemployment is going down, most b/c folks are dropping out of the job market.
There are many different reason why folks are against tax increase. Many folks feel that given the debt we should cut spending before we automatically think of raising taxes.Report
FACTS not in evidence, SCOTT. Go read calculated risk, or quote the u6 if you want (I like it better myself, as a measure of unemployment). But if you’re going to say false shit, I’ma gonna call you on it.
I agree that we ought to cut spending. Military spending (particularly on stuff the military umm… doesn’t actually want). Prison Spending (rehab is MUCH MUCH cheaper!). Hell, if you guys are willing to do that as a gesture of good faith and will, I’m willing to start in on a true negative income tax (Just scrap all the programs and give people the money upfront! What’s the worst that could happen? Let charity take care of the fuckups).Report