Frum: How the Tea Party could drive GOP to disaster

[Matt1970]

It may have partly been a recession but it was largely EGTRRA in mid 2001 and JGTRRA in 2003... look how the red follows those 2 tax cuts perfectly, the large amount of lost revenue was tax cuts not recession. Obviously both had some impact, but your statement that the drops in red were recession and stock market related only is epic stupidity. Remember... EGTRRA and JGTRRA cost us between $200-$250 billion a year.

BTW, neither of those tax cuts did shit to help the economy either. EGTRAA had nearly 0 effect on the recession at the time and JGTRRA didn't do shit either to help the economy. The only thing that got us out of that recession was the housing boom, which got us into this current recession. It just delayed the inevitable, it was a fake recovery by inflating the assets of people.

No, it isn't. The dot-com bubble burst on Friday, March 10, 2000 right when the red line representing Federal Revenue plummited. You will notice how the red line makes a dramatic turn around and starts to rise around 2003 *cough* JGTRRA. Sorry pal, but the tax cuts increased Revenue this time and it was before the housing bubble.

 

[Matt1970]

You really don't understand money at a macro level, at all.

First off, the annual deficit must be as large as the balance of payments deficit if we're to maintain domestic liquidity w/o the creation of more debt in the private sector. Think of it as replacement money. The balance of payments deficit exists to boost profits of American capitalists.

Except the debt accumulates. We are now at 10% of total Revenue just to pay the interest on the debt. What happens when it's 20%?

 

[irishScott]

I wasn't aware the GOP could go much lower but ...heh I'm all for your analysis

Oh things can always go lower. Maybe one day Bachman will get the nomination. *shudders*

 

[Jhhnn]

Except the debt accumulates. We are now at 10% of total Revenue just to pay the interest on the debt. What happens when it's 20%?

You're the big fan of international capitalism in a free trade environment, with ultra low taxes on the largest investment based incomes, so you explain it. It's the result of what you believe in, after all.

I just pointed out the mechanics of it.

 

[Dulanic]

No, it isn't. The dot-com bubble burst on Friday, March 10, 2000 right when the red line representing Federal Revenue plummited. You will notice how the red line makes a dramatic turn around and starts to rise around 2003 *cough* JGTRRA. Sorry pal, but the tax cuts increased Revenue this time and it was before the housing bubble.

Can I have some of the drugs your on?

 

[Jhhnn]

No, it isn't. The dot-com bubble burst on Friday, March 10, 2000 right when the red line representing Federal Revenue plummited. You will notice how the red line makes a dramatic turn around and starts to rise around 2003 *cough* JGTRRA. Sorry pal, but the tax cuts increased Revenue this time and it was before the housing bubble.

You confuse correlation with causation, and ignore the fact that tax cuts kept income below expenditures. Even in the false prosperity of the ownership society, revenues were depressed. You couldn't show that tax cuts accounted for the earlier increase in revenue if your life depended on it. As this graph illustrates, the housing bubble was well on its way by 2003, experiencing a cyclical upswing even before Dubya took office.

http://www.nytimes.com/imagepages/2006/08/26/weekinreview/27leon_graph2.html

Notice how revenues fell below expenditures in the Reagan era, and exceeded them only after Clinton era tax increases and an upswing in the economy.

I'll grant that cuts in capital gains rates will result in profit taking and perhaps increased revenue, but there's only just so much money in that reservoir. The effect is entirely temporary.

 

[Matt1970]

You confuse correlation with causation, and ignore the fact that tax cuts kept income below expenditures. Even in the false prosperity of the ownership society, revenues were depressed. You couldn't show that tax cuts accounted for the earlier increase in revenue if your life depended on it. As this graph illustrates, the housing bubble was well on its way by 2003, experiencing a cyclical upswing even before Dubya took office.

http://www.nytimes.com/imagepages/2006/08/26/weekinreview/27leon_graph2.html

Notice how revenues fell below expenditures in the Reagan era, and exceeded them only after Clinton era tax increases and an upswing in the economy.

I'll grant that cuts in capital gains rates will result in profit taking and perhaps increased revenue, but there's only just so much money in that reservoir. The effect is entirely temporary.

I guess you are going to see it whichever way you want.

 

[Engineer]

I guess you are going to see it whichever way you want.

and you don't?

LOLOLOL