The Budget Battle and the "Which Side Does More Demagoguing"? Thread

[LA Ute]

Now that there has been no government shutdown we can now ease into a big battle between Repubs and Dems over which side plans to do the most dastardly things while addressing the budget, the deficit, and all that fun stuff. Here's my first entry in the contest, from Jake Tapper at ABC:

President Obama at the GOP House retreat, January 2010:

“We're not going to be able to do anything about any of these entitlements if what we do is characterize whatever proposals are put out there as, ‘Well, you know, that's -- the other party's being irresponsible. The other party is trying to hurt our senior citizens. That the other party is doing X, Y, Z.”

President Obama today:

“One vision has been championed by Republicans in the House of Representatives and embraced by several of their party’s presidential candidates…This is a vision that says up to 50 million Americans have to lose their health insurance in order for us to reduce the deficit. And who are those 50 million Americans? Many are someone’s grandparents who wouldn’t be able afford nursing home care without Medicaid. Many are poor children. Some are middle-class families who have children with autism or Down’s syndrome. Some are kids with disabilities so severe that they require 24-hour care. These are the Americans we’d be telling to fend for themselves.”

[YOhio]

Unrelated to the topic, but related to your post, I think Jake Tapper is my favorite reporter.

[il Padrino Ute]

Unrelated to the topic, but related to your post, I think Jake Tapper is my favorite reporter.

[NorthwestUteFan]

The answer is simple, duh! The side with the politicians is going to do the most demagoguing.

We, the huddled, non-political masses are going to lose the battle! It doesn't really matter which side we cheer for either.

[LA Ute]

Most people call them tax cuts, but Pres. O. calls them "spending reductions in the tax code:"

Essentially tossing aside the budget he submitted just two months ago, Mr. Obama called for much deeper defense and domestic spending cuts and said while he will not trim benefit payment from Social Security, Medicare or Medicaid, more money can be squeezed out of the latter two programs in other ways.

The president also called for undoing the Bush tax cuts for upper-income taxpayers, and for canceling other tax cuts many of them receive such as the mortgage interest deduction — which he called “spending reductions in the tax code.”

Pretty Orwellian. Of course, tax cuts are spending reductions only if you believe, as the president does, that the money isn't really yours, but belongs to the government.

[byu71]

[QUOTE=LA Ute;574592]Most people call them tax cuts, but Pres. O. calls them "spending reductions in the tax code:

Is he still defining upper income $250,000? How hard is he going to hit them. I don't understand how the dems dont get this tax increases through.

Let's see, I made $200,000, sure tax the hade out of those guys. I am surprised my two boys who dont make that kind of money are move conservative than I am and are more against tax hikes than I am. They have bought into the idea if you tax the rich too much, you hurt the economy.

[Jeff Lebowski]

Pretty Orwellian. Of course, tax cuts are spending reductions only if you believe, as the president does, that the money isn't really yours, but belongs to the government.

Speaking of demagoguery.

Anyone who isn't willing to look at taxes as part of the solution for the deficit mess is part of the problem.

[Uncle Ted]

Is he still defining upper income $250,000? How hard is he going to hit them. I don't understand how the dems dont get this tax increases through.

Let's see, I made $200,000, sure tax the hade out of those guys. I am surprised my two boys who dont make that kind of money are move conservative than I am and are more against tax hikes than I am. They have bought into the idea if you tax the rich too much, you hurt the economy.

Taxing the rich seems like a simple solution on paper but no one thinks about what a higher tax on the rich will do. Unlike the middle class the rich are in a position to adjust, not to mention change how many people they employee. After Maryland raised taxes on the rich one third of them went missing. Did their stupid government really think they would stay in Maryland when the rich can easily just move? Because of this tax increase Maryland lost over a billion dollars of their tax base to other states.

Raising taxes on the rich at the federal level would most likely change how the rich make their money. For example:

(1) Many two-income families will most likely become one-income families. Families may downsize because taxes take too much of a bite to make it worth it.

(2) Investors, including myself, who jumped into dividend-paying stocks in 2003 when the dividend tax rate fell to 15% will most likely dump those stocks in favor of other investments, like tax-free muni bonds. Of course, the sale off of these dividend-paying stocks may trigger some negative reaction on the market. Stocks may be dumped at a loss which may offset capital gains. If so, the government would collect less than expected with taxes on dividends.

(3) Professional, such as doctors and lawyers, that have control on how much they make would most likely play more golf or something than see more clients. People don't work harder to pay more taxes. People work harder for what they paid after taxes. If the after tax income is not that much then things like golf become a lot more attractive.

(4) Given the corporate tax would most likely be lower I can see more business owners forming c-corporations to shelter income. With the cost of benefits going up business owners may hire less people and just incentivize the employees they have to work harder with bonuses and/or company perks.

(5) If the capital gains tax is going to increase then investors may start an sell off to realize those gains before the tax rate goes up in accounts that are not tax free. After it goes up they will most likely hold on stocks longer rather than realizing gains and paying taxes (unless they have loses to offset those gains). In short, the government's tax revenue from capital gains taxes will most likely take a hit.

All of the above would most likely hurt the economy by making it grow slower than it could. Also, the government projections on the increased tax revenue would mostly not account for this and, therefore, they would simply be forced to look at how they can tax the middle class more with hidden taxes and fees to make up the short fall.

[YOhio]

Anyone who isn't willing to look at taxes as part of the solution for the deficit mess is part of the problem.

Agree, but I'd also include entitlement reform.

[Jeff Lebowski]

Agree, but I'd also include entitlement reform.

Sure. Everything has to on the table. Including defense spending.

[YOhio]

Sure. Everything has to on the table. Including defense spending.

Especially the corp of engineers.

[Borderline Divine]

While it is true the rich fled Maryland, did they flee the U.S? If so, good riddance. If you are so unpatriotic and greedy that you won't give back to the economy that made you wealthy, then have a grand time elsewhere.

Somalia has no taxes at all...that might be a good choice for you.

[LA Ute]

Speaking of demagoguery.

Anyone who isn't willing to look at taxes as part of the solution for the deficit mess is part of the problem.

There is a philosophical divide on this issue. Liberals/Democrats talk about tax cuts as something that must be "paid for," as if the money were the government's to begin with. Obama emphasizes fairness and redistribution of wealth as the bases for his tax proposals. Conservatives/Republicans emphasize economic growth and personal economic liberty as the bases for theirs. I prefer the latter philosophy but recognize there are opposing points of view. Those views are not evil, just wrong.

[Mormon Red Death]

While it is true the rich fled Maryland, did they flee the U.S? If so, good riddance. If you are so unpatriotic and greedy that you won't give back to the economy that made you wealthy, then have a grand time elsewhere.

Somalia has no taxes at all...that might be a good choice for you.

Why are the rich bad guys? btw... all this circumventing the income tax goes away with the the fair tax. Everyone pays there fair share.

[snowcat]

According to Internal Revenue Service data, the entire taxable income of everyone earning over $100,000 in 2008 was about $1.582 trillion. Even if all these Americans—most of whom are far from wealthy—were taxed at 100%, it wouldn't cover Mr. Obama's deficit for this year.

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