Why is spending more money that we don't have the way out of a recession?

[TurtleDude]

Yes - but that's not the main or sole purpose of taxes.

it is a main purpose since the New Deal

it is also the promise of using taxes for that that gets dem politicians many of their votes

any time one person pays more than what he uses in government services it is income distribution.

so while taxes main purpose might not be "income redistribution the fact is that 10% of the population pays most of the taxes it is fair to say most of the taxes are redistributing income even if that means me paying for my share of national defense and that of 100 other americans as well even if those 100 don't actually get cash from me.

 

[OscarB63]

anyone who claims that dems don't pander to the poor for votes by promising bigger and better entitlement programs, paid for with tax $$$, is just being dishonest.

 

[Aunt Spiker]

it is a main purpose since the New Deal

it is also the promise of using taxes for that that gets dem politicians many of their votes

any time one person pays more than what he uses in government services it is income distribution.

so while taxes main purpose might not be "income redistribution the fact is that 10% of the population pays most of the taxes it is fair to say most of the taxes are redistributing income even if that means me paying for my share of national defense and that of 100 other americans as well even if those 100 don't actually get cash from me.

We might just have to agree to disagree on that - though I see your point, I don't feel that way.

And neither do the actual numbers of how much is gained from taxes and where it's spent.

 

[Donc]

anyone who claims that dems don't pander to the poor for votes by promising bigger and better entitlement programs, paid for with tax $$$, is just being dishonest.

Of course you have something other than your opinion to prove this statement? :2wave:

 

[Aunt Spiker]

You only need to look at the week's news to discover that's actually true of ALL politicians.

They're all playing a vote-get game with the people whom they choose they want to please. Nothing new, nothing secret - and nothing *just* Democratic.

 

[TurtleDude]

We might just have to agree to disagree on that - though I see your point, I don't feel that way.

And neither do the actual numbers of how much is gained from taxes and where it's spent.

when 10% of the population pays the majority of the federal income taxes, those taxes are income redistributionist pure and simple

the only time taxes are not redistributionist is user taxes or stuff like that.

 

[mertex]

you think people making 200K a year are the very richest of the rich?

First of all, its $250K not $200K. And it is people that are making over $250K, and yes, those making way over $250K are very rich. Only 1.5% of US population make more than $250K a year.

tax cuts don't need to be paid for

Why not? They don't pay for themselves.

In fact, however, the evidence tells a very different story: the tax cuts have not paid for themselves, and economic growth and revenue growth over the course of the recovery have not been particularly strong.
Claim That Tax Cuts "Pay For Themselves" Is Too Good To Be True — Center on Budget and Policy Priorities

when you learn that fact you might be better able to argue economic points.

Seems to me you are the one that needs to learn that fact!

 

[mertex]

its worse than burning the dollars. the money is used to buy the votes of those who empower lib politicians and the money is used to create more dem bots addicted to government spending

What? It's the conservatives that are trying to appease the ones that fund their campaigns, why they're whining about not letting the tax cuts expire.

And, it isn't like the Republicans don't spend....check out Bush's spending.

 

[MaggieD]

Thread: Why is spending more money that we don't have the way out of a recession?

Because spending more than we had was what got us into the recession.

Credit was easy-peasy!! Just refinance your house and pull out the equity!! Yay!! Oh, and did I mention I can lower your interest rate? (Who cares! I can pull out all the equity!) Credit card interest was pretty static; limits were raised regularly for those who paid their bills on time; lenders let us all buy homes with no money down and, hey, face it -- you didn't even have to be able to afford it. You could just simply get a "stated-income loan!" Ridin' on easy street!

All those bogus buyers chasin' houses made for dual and triple offers on homes -- many selling for $5K or more over list price! Yay!! Homeowners looked in their mailboxes when they got home from work and found alllll kinds of goodies!! Yay!! "Honey!!! We can borrow 110% on the value of our home!! 3% interest!! Yay!!"

And they did!! And they took cool vacations on the borrowed money; bought big screens; new appliances; guys bought all their toys; gals bought all their clothes and furniture. Life was good!! No!! Life was great!!

Then rates started to reset on mortgages. Oops. Those adjustable-rate mortages began adjusting. And people began feeling the squeeze. And Wall Street finally started looking at the creeping default rate. Oops again. So lenders had to tighten standards. Then those home buyers? The ones who couldn't buy lunch? Welllllll, they dried up. \

Real estate slowed. No more double/triple offers. In fact, instead of days to sell a home, it started to take months. More ARM's reset. Defaults. And more. Defaults. Mortgage payments started going through the roof. More defaults. Home prices plummeted. Not only had easy-peasy credit gone out the window, but all the foreclosures on the market were dropping the price of MY house. Oops again.

People whose rates reset found they couldn't afford their new mortgage payments. Defaults. People started looking at the amount of their 97% mortgages and said, "What the hell? My house isn't worth what I paid for it. I'm not going to keep pourin' money down a rat hole." Still More Defaults. Oops. And we're not done yet.

The money tree dried up. Credit card companies began lowering the amount of credit available on people's cards. People weren't taking vacations, buying big screens, or clothes, or furniture with borrowed money anymore. They were tapped out.

Recession. Depression. Call it what you will.

It all boils down to our whole economy was nothing more than a house of cards; and they toppled over.

 

[TurtleDude]

First of all, its $250K not $200K. And it is people that are making over $250K, and yes, those making way over $250K are very rich. Only 1.5% of US population make more than $250K a year.


Why not? They don't pay for themselves.

In fact, however, the evidence tells a very different story: the tax cuts have not paid for themselves, and economic growth and revenue growth over the course of the recovery have not been particularly strong.
Claim That Tax Cuts "Pay For Themselves" Is Too Good To Be True — Center on Budget and Policy Priorities


Seems to me you are the one that needs to learn that fact!

several errors from you

200 for individuals, 250 for married couples

tax cuts don't have to be paid for. ONly the people who think the government owns all the money would claim that tax cuts have to be paid for-government spending has to be paid for.

if you knew more about economics and finance than I do you would be getting soaked next year,

I suspect you are not and do not

"way over 250K" but that isn't the issue-the top rates start at 200K for individuals

why do you welfare-socialists talk about the Very wealthy and yet your schemes target 200K? that's not very wealthy

just like a million dollar estate is not large wealth yet that is where the death confiscation tax kicks in next year

 

[TurtleDude]

What? It's the conservatives that are trying to appease the ones that fund their campaigns, why they're whining about not letting the tax cuts expire.

And, it isn't like the Republicans don't spend....check out Bush's spending.

keeping more of my money is legitimate

you wanting more of it is not

I have no duty to pay for your existence-your existence does not benefit me at all

and its true, the GOP spends too much as well-but as Obama has proven, not nearly as much as dems

 

[mertex]

it is a main purpose since the New Deal

it is also the promise of using taxes for that that gets dem politicians many of their votes

any time one person pays more than what he uses in government services it is income distribution.

But the wealthy use more government, ergo, they should pay more.

Shouldn't everyone pay the same amount?

In a word-- no. It's not more fair; it's appallingly unfair. Why? The rich should pay more taxes, because the rich get more from the government.

Consider defense, for example, which makes up 20% of the budget. Defending the country benefits everyone; but it benefits the rich more, because they have more to defend. It's the same principle as insurance: if you have a bigger house or a fancier car, you pay more to insure it.

Social security payments, which make up another 20% of the budget, are dependent on income-- if you've put more into the system, you get higher payments when you retire.

Investments in the nation's infrastructure-- transportation, education, research & development, energy, police subsidies, the courts, etc.-- again are more useful the more you have. The interstates and airports benefit interstate commerce and people who can travel, not ghetto dwellers. Energy is used disproportionately by the rich and by industry.

As for public education, the better public schools are the ones attended by the moderately well off. The very well off ship their offspring off to private schools; but it is their companies that benefit from a well-educated public. (If you don't think that's a benefit, go start up an engineering firm, or even a factory, in El Salvador. Or Watts.)

The FDIC and the S&L bailout obviously most benefit investors and large depositors. A neat example: a smooth operator bought a failing S&L for $350 million, then received $2 billion from the government to help resurrect it.

Beyond all this, the federal budget is top-heavy with corporate welfare. Counting tax breaks and expenditures, corporations and the rich snuffle up over $400 billion a year-- compare that to the $1400 budget, or the $116 billion spent on programs for the poor.

Where's all that money go? There's direct subsidies to agribusiness ($18 billion a year), to export companies, to maritime shippers, and to various industries-- airlines, nuclear power companies, timber companies, mining companies, automakers, drug companies. There's billions of dollars in military waste and fraud. And there's untold billions in tax credits, deductions, and loopholes. Accelerated depreciation alone, for instance, is estimated to cost the Treasury $37 billion a year-- billions more than the mortgage interest deduction. (Which itself benefits the people with the biggest mortgages. But we should encourage home ownership, shouldn't we? Well, Canada has no interest deduction, but has about the same rate of home ownership.)


Why the rich should pay more taxes

so while taxes main purpose might not be "income redistribution the fact is that 10% of the population pays most of the taxes it is fair to say most of the taxes are redistributing income even if that means me paying for my share of national defense and that of 100 other americans as well even if those 100 don't actually get cash from me.

Quit griping about paying your fair share. If you are paying more in taxes, it means you are making more money. Be glad. Those that don't pay much in taxes, also don't have much.

 

[mertex]

keeping more of my money is legitimate

You don't have a special tax rate made out specially for you. You are just like most conservatives, greedy.

you wanting more of it is not

I don't want any of your money. I have plenty of my own. The difference is that I don't mind paying taxes and some of it going to help the poor. I mind more what goes to help the very rich. You on the other hand, don't mind corporate welfare, but sure cry about the small percent that goes to welfare for the poor.

I have no duty to pay for your existence-your existence does not benefit me at all

You are not paying for my existence. I am probably paying for your existence. You don't hear me whining.

and its true, the GOP spends too much as well-but as Obama has proven, not nearly as much as dems

Obama's spending has only been as a result of trying to fix the big mess you conservatives left behind. It will decrease as the economy gets better, but it is hard to make a dent in the economy when the conservatives are working so hard to keep it down.

 

[mertex]

several errors from you

200 for individuals, 250 for married couples

$200K for a single person is still a lot of money, considering that only increases by $50K for married. Still only 2% of the US population make that much, so where does the idea that one who makes $200K or $250K is not wealthy?

tax cuts don't have to be paid for. ONly the people who think the government owns all the money would claim that tax cuts have to be paid for-government spending has to be paid for.

You seem to be having the same problem that Mitch McConnell had.

Does Mitch McConnell really not understand this? He’s the Senate Minority leader and he doesn’t understand that if you cut taxes that means that less money will come into the government’s coffers. When you don’t balance that loss of income with a cut in spending, you run a deficit. You either pay for the tax cut by cutting spending, or you pay for it by taking out a loan from China. I guess we know the Republican plan – take out a loan from the Chinese to pay for a tax cut for the rich. This isn’t any different from what the Republicans did for the entirety of the Bush Administration.

http://bluewavenews.com/blog/2010/0...den-become-something-that-we-quote-‘pay-for’/

if you knew more about economics and finance than I do you would be getting soaked next year,
I suspect you are not and do not

So, you are getting soaked next year just because you know so much about economics and finance?
You didn't know that tax cuts had to be paid for.

"way over 250K" but that isn't the issue-the top rates start at 200K for individuals

A person that makes $200K will not have to pay as much as someone that makes $500K or $1M.

why do you welfare-socialists talk about the Very wealthy and yet your schemes target 200K? that's not very wealthy

Do you make $200K? Only 2% of Americans do, I suppose that is pretty wealthy.

just like a million dollar estate is not large wealth yet that is where the death confiscation tax kicks in next year

It depends on where the estate is. Here is a link that shows what you can get for $1M in different parts of the country.

$1 million homes: O.C. vs. elsewhere - Lansner on Real Estate : The Orange County Register

 

[TurtleDude]

Thhe wealthy do no use more government services=that is a complete myth. Who is most of the prison population? who uses SSI the most. who uses emergency rooms that the rest of us pay for the most> stop the nonsense. the top 1% pay 40% of the income tax, 47% pay no income tax-there is no possible way that the top 1% are using 40% of the government services paid for by the income tax while that 47% is using NONE of the services paid for by the income tax
I like how you backpeddaled on the amount of money that starts the extra soaking. citing an opinion piece has no value to me.

and no tax cuts don't have to be paid for-its government spending. If you want more government spending its time for people like you to pony up the costs rather than saying people like me ought to

 

[TurtleDude]

Please list the actual additional benefits someone who pays 200K to the government in federal income taxes gets over someone who pays say 10K

the nonsense that someone making 200K a year benefits more from an educated population (which is the result of a PROPERTY TAX not an INCOME TAX) by a factor of 20-1 is complete speculative moose poop.

the fact is the income redistributionists pull this crap out of their sixes because that is the best they can come up with knowing its nonsense.

keeping someone in prison is massively expensive. WHo makes up most of the prison population? who makes up most of the victims of those in prison. Not the top 2%

ever heard of SSI-supplemental security income-that comes from income taxes not SS payments--who uses most of that? its means tested so its not the wealthy

much of the government regulatory functions were put into place under dem administrations designed to protect the "public" from "corrupt corporate practices" etc. that benefits the average consumer far more than the rich.

when you save money are you paying for that? no, you might have to spend less but you don't have to pay for saving. You just have less to spend on stuff. right now we spend way too much stuff on wasteful crap and as long as people like you expect people like me to pay more and more taxes to fund the crap you use, you will never have any incentive to reign in wasteful spending or stop jacking my taxes up

 

[Mensch]

How does cutting $Trillon$ of tax obligation on the very richest of the rich, without paying for it and getting us ass deep in TWO unnecessary wars put on a Chinese Credit Card equal responsible govening? You answer first.

I'm for cutting taxes on all Americans, not just the richest of the rich. I'm not a rich man. I work 40 hours a week at 12$ an hour and I get paid bi-weekly. The government took 150$ out of my paycheck, in order to fnance the lifestyle of a far wealthier minority of society (the elderly make up one of the wealthiest brackets in society, and we subsidize them while spending 1/6 the amount on our children).

And you're talking to a libertarian. Since you've self-identified as "very liberal," you can blame yourself and your fellow liberals for supporting a president who is escalating a very costly and unnecessary war in Afghanistan. I have also always been against the Iraq war.

Now, you answer. How do you expect the government to magically spur the economic growth by spending money we don't have on entitlement programs that only get bigger over time?

 

[Mensch]

How are businesses not moving weath around? Consumers are transfering their wealth to the producer in exchange for an item. That producer now has that wealth and invests it, and then transfers wealth to another producer by acting as a consumer. Government can take your money, just as you give it to a producer, and use it to invest or purchase.

When government sponsors its own investment, it must forcibly remove wealth from one part of the country in order to subsidize their particular investment. The government "invested" in real estate, and look where it got us!

Btw, I voluntarily exchange my money for something I consider to be worthy of my own money. Is it more efficient for a person to spend his own money or for politicians to spend other people's money? Since I'll be paying more to finance the program of medicare, while receiving less benefits come 2050, how well has the government been using my money to invest in my own retirement insurance?

 

[Mensch]

The % of people who received most or all of their income and benefits purely form government aid is very small. . . taxes aren't income redistribution (as someone very gracefully explained in another thread) - it's a way for the government to fund all of it's programs, expenses, wants and needs.

Only a very small portion of what they take from me goes to my neighbor down the street in the form of welfare, etc.

Since the government confiscates 40% of the nation's gross income to finance all their wasteful, and harmful programs, I think I have good reason to be upset. And you're also forgetting the fact that medicare is a welfare check; it is not insurance as it is often painted out to be.

 

[Aunt Spiker]

Hey - don't come down on me.
I don't support our current tax system, either - but I try not to falsely represent what it really is there for.

Where does the bulk of the government's money come from?
**** as hell aint income tax.

 

[mpg]

The % of people who received most or all of their income and benefits purely form government aid is very small.

It's true that very few people get most or all of their income from the government, but even if they get a portion of it from the government, that encourages (bribes) them to vote for the politicians who support those programs.

. . taxes aren't income redistribution (as someone very gracefully explained in another thread) - it's a way for the government to fund all of it's programs, expenses, wants and needs.

Only a very small portion of what they take from me goes to my neighbor down the street in the form of welfare, etc.

That's just plain false. Less than half of federal revenues are used for things that we all use such as roads and defense. It's common knowledge that entitlements make up the majority of federal spending. Most us what we pay in taxes is simply given to someone else, and most of that goes to seniors, one of the wealthiest age groups. Politicians receive votes in return for being generous with other people's money.

 

[Donc]

Thhe wealthy do no use more government services=that is a complete myth. Who is most of the prison population? who uses SSI the most. who uses emergency rooms that the rest of us pay for the most> stop the nonsense. the top 1% pay 40% of the income tax, 47% pay no income tax-there is no possible way that the top 1% are using 40% of the government services paid for by the income tax while that 47% is using NONE of the services paid for by the income tax
I like how you backpeddaled on the amount of money that starts the extra soaking. citing an opinion piece has no value to me.

and no tax cuts don't have to be paid for-its government spending. If you want more government spending its time for people like you to pony up the costs rather than saying people like me ought to

More bull**** from Turtledude. It doesn’t matter who uses the services that “SOCIETY” provides in a civilized country. WTF are you advocating, a barcode on someone’s a** to see how much services they are entitled to? :shock:

 

[SheWolf]

In my opinion, the only reason the middle and lower income people would need a tax break, was if we had run away inflation. That isn't the case now. What the middle and lower income folks need are jobs. The only way to create jobs is to cut the business owners some slack. Of course, you won't ever hear a politician say that, because that would be political suicide.

If you mean cutting taxes, but cutting slack.. that isn't going to create jobs. When businesses have declining net incomes, they are paying less and less taxes due to the decline in their net incomes anyway. Cutting their taxes to zero won't do anything if they are in the red anyway. Business owners, especially small business owners are more likely to use any tax credit to just cover their overhead in a recession.

Businesses have their hands tied until consumer spending and demand picks up. When demand is in the economy again, their net income will finally see growth.

 

[samsmart]

The title speaks for itself.

Because the Republicans don't want to raise taxes, and even provide tax breaks to those who can afford paying more taxes, than cut government spending on their pet programs for their campaign donors, such as farm subsidies and defense contractors.

 

[Geo Patric]

The title speaks for itself.

if so, it does not do so very well.

firstly, you cannot spend money that you do not have any more that you can eat apples that you do not have or diddle girls that are not there.

we DO have the monies that we are spending. we have borrowed it. we were obliged to borrow it because we are not collecting sufficient revenues to meet our obligations. we are not collecting sufficient revenues because some dip**** turned off the revenue stream by cutting taxes and increased the obligations by starting two very expensive wars. so, we borrow.

borrowing money to invest it is a pretty standard practice. in fact, that is why lending developed into an industry. borrowong more than you can pay back is risky, but your religion of wealth is based on that very same risk.

the government's obligation to you and me to protect the nation's wealth obliges sound safe borrowing and sound investing, not NO borrowing and NO investing.

safe borrowing means that you can pay the interest and whatever portion of the principle required by the lender for the period of time allowed by the lender. as long as you can pay the nut, your debt is responsible. If your investments prove sound, you can start paying off the principal. that is how it works.

if you have no money and you are unwilling to borrow, you get to live on whatever you have. I don't know if you have looked recently, but what we have would not keep a sparrow alive for more than a few days.

so we borrow. we spend to invest on the premise of a greater return. it is not a new idea. we have done it to varying degrees since the nation was founded. are you aware that this nation has NEVER been out of debt?

geo.