US rivals clash on banking crisis

[rjd970]

that's not true at all. if obama is elected and starts raising investment taxes an dividend taxes. watch how much good and services are going to rise. watch how much of your 401k returns will decrease. i trust him to lower our taxes as far as i can throw michael moore. you're truly clueless if you actually think hussein obama is going to cut our taxes. what a joke.

The price of goods and services are rising now, and 401k's are taking a massive hit. Its going to change if McCain continues the Bush economic policies?

Going by what each candidate is said I should expect to see a tax cut under both plans. You're a priori dismissal in Obama's plan and blind faith in McCain's is telling. Instead, you resort to calling me clueless, attack "Hussein Obama's" plan, and give "McSame's" a pass. Aside from being a petty argument, it hardly represents any kind of objective analysis.

 

[OrangeEmpire]

The price of goods and services are rising now, and 401k's are taking a massive hit. Its going to change if McCain continues the Bush economic policies?

Going by what each candidate is said I should expect to see a tax cut under both plans. You're a priori dismissal in Obama's plan and blind faith in McCain's is telling. Instead, you resort to calling me clueless, attack "Hussein Obama's" plan, and give "McSame's" a pass.

Joe is comedy relief...... you will learn young one....

 

[BigPapaVol]

The price of goods and services are rising now, and 401k's are taking a massive hit. Its going to change if McCain continues the Bush economic policies?

Going by what each candidate is said I should expect to see a tax cut under both plans. You're a priori dismissal in Obama's plan and blind faith in McCain's is telling. Instead, you resort to calling me clueless, attack "Hussein Obama's" plan, and give "McSame's" a pass. Aside from being a petty argument, it hardly represents any kind of objective analysis.

which Bush policies are driving the 401K values south? Which ones are resulting in inflation?

Can you even talk about McCain's plan relative to Bush's and point out where they're the same?

Finally, you do realize that monetary policy is an entirely different matter than taxes and budgets, right?

 

[volinbham]

Here's one difference between McCain and Bush - McCain is calling for the head of the SEC Chairman and Bush is saying his job is safe!

 

[rjd970]

Can you even talk about McCain's plan relative to Bush's and point out where they're the same?

McCain is promising to cut taxes by $300 billion per year on top of the Bush tax cuts, which he would make permanent. In addition to this, he promises to balance the budget in his first term. Exactly how is he going to do that? If you are going to harp on Obama's plan with all his spending, then you have to ask how McCain is going to do it with all his cuts. The revenue that was supposed to be generated with the Bush tax cuts simply never came to fruition and have actually decreased when population growth and inflation are factored in. The notion that tax cuts pay for themselves is a myth, and McCain said he could do it in part by cutting out earmarks, saving $100 Billion per year, but by all conventional measures it would only save $18 Billion.

The tax cuts of 2001 and 2003 did not produce the promised economic growth. If anything, it was no different than under the democratic administration of the 90's, with revenues actually decreasing. It did not produce the promised jobs or lift wages. Even Greg Mankiw, the former chairman of the Council of Economic Advisors under Bush, has said that there is "no credible evidence" that tax cuts pay for themselves and that an economist who makes such a claim is a "snake oil salesman who is trying to sell a miracle cure."

After inflation, household income has fallen below 2000 levels despite the few years of economic growth between the 2001 and 2008 recessions. Artificially lowering interest rates boosted the housing market artificially, leading to a very real crash. His economic plan not only adopts Bush’s policies, but digs the hole deeper.


All you guys have is democrat = tax and spend. There is no reason to believe the republican = borrow and spend mantra is any better. Just keep repeating the same old attacks...all it says is that you can take the cracker and squawk.

 

[volinbham]

All you guys have is democrat = tax and spend. There is no reason to believe the republican = borrow and spend mantra is any better. Just keep repeating the same old attacks...all it says is that you can take the cracker and squawk.

You are squawking right along with us.

 

[rjd970]

You are squawking right along with us.

I was referring to the charges of Obama being a socialist, likening him to Karl Marx, calling him "Hussein" in a manner that is derogatory....villifying Obama's economic plan because somebody somewhere told me he is going to "raise my taxes". I'm not on hear constantly referring to McCain as an old fart, "McSame", "McBush", etc....I could take the low road, go on MSNBC or huffingtonpost, grab their talking points, and squawk tit-for-tat with you guys.

I am simply saying that neither candidate is really addressing the issue of spending and McCain's plan is not as superior to Obama's as everybody is suggesting and certainly not any more detrimental.

 

[KB5252]

I was referring to the charges of Obama being a socialist, likening him to Karl Marx, calling him "Hussein" in a manner that is derogatory....villifying Obama's economic plan because somebody somewhere told me he is going to "raise my taxes". I'm not on hear constantly referring to McCain as an old fart, "McSame", "McBush", etc....I could take the low road, go on MSNBC or huffingtonpost, grab their talking points, and squawk tit-for-tat with you guys.

I am simply saying that neither candidate is really addressing the issue of spending and McCain's plan is not as superior to Obama's as everybody is suggesting and certainly not any more detrimental.

Who's talking points do you think we use, please tell. In your time here you have alluded to McCain being no different than Bush so please spare us your objective spiel.

 

[volinbham]

Back to the tax analysis - I reread the TPC report. They rely on 2 crucial assumptions that are questionable at best.

They use current CBO projections of economic growth into the future and as far as I can tell treat that as a fixed variable - in other words, assume NEITHER plan changes the level of economic growth.

They use current budgets based on current laws to measure spending.

The conclusion of impact on revenues is highly dependent on economic growth - there analysis here is correct only if: 1) economic growth occurs as predicted and 2) that neither plan impacts economic growth differentially. If fiscal stimulus (via tax policy) doesn't impact economic growth why in the world change it?

The conclusion of impact on deficits compounds the above error by assuming both candidates spending plans will be equal. Clearly that is not the case.

 

[rjd970]

Who's talking points do you think we use, please tell. In your time here you have alluded to McCain being no different than Bush so please spare us your objective spiel.

So exactly what are those differences, especially with tax policy? I'm all ears. This isn't a talking point, it is what it is.

-McCain plans to make the Bush tax cuts permanent and add more cuts for the upper income bracket including capital gains and corporate profit tax cuts. No billionaire left behind policy continued.

-McCain plans to maintain the Bush energy policy with continued benefits for the oil industry while at the same time allowing alternative energy programs to expire by failing to show up to vote for the program ... multiple times. No oil executive left behind continued.

-War on terror. McCain plans to continue Bush policies.

-Foreign affairs. McCain plans to continue Bush policies.

-Health Care. Bush plan revised.

-Social Security. Bush plan, revised

Read all about it:

JohnMcCain.com - McCain-Palin 2008

When you actually go to his campaign site and read his plans, they are basically updated versions of the '00 and '04 Bush plans. We're involved in extremely expensive conflicts in Iraq and Afghanistan as well as the war on terror. We have alienated our closest friends and allies. We have massive corruption in our government, a $4.4 trillion increase in our debt, record annual deficits, increased inflation and unemployment, and, now, $816 Billion in bail-outs socializing much of the U.S. banking system.

 

[KB5252]

So exactly what are those differences, especially with tax policy? I'm all ears. This isn't a talking point, it is what it is.

-McCain plans to make the Bush tax cuts permanent and add more cuts for the upper income bracket including capital gains and corporate profit tax cuts. No billionaire left behind policy continued.

-McCain plans to maintain the Bush energy policy with continued benefits for the oil industry while at the same time allowing alternative energy programs to expire by failing to show up to vote for the program ... multiple times. No oil executive left behind continued.

-War on terror. McCain plans to continue Bush policies.

-Foreign affairs. McCain plans to continue Bush policies.

-Health Care. Bush plan revised.

-Social Security. Bush plan, revised

Read all about it:

JohnMcCain.com - McCain-Palin 2008

When you actually go to his campaign site and read his plans, they are basically updated versions of the '00 and '04 Bush plans. We're involved in extremely expensive conflicts in Iraq and Afghanistan as well as the war on terror. We have alienated our closest friends and allies. We have massive corruption in our government, a $4.4 trillion increase in our debt, record annual deficits, increased inflation and unemployment, and, now, $816 Billion in bail-outs socializing much of the U.S. banking system.

You stated there was no advantage between McCain and Obama's tax plan so how then will Obama give us a different result than Bush's when he and McCain are so similar. Follow this logic on the tax plans and you come up with: McCain= Bush= Obama as far as taxes go.

 

[rjd970]

They use current CBO projections of economic growth into the future and as far as I can tell treat that as a fixed variable - in other words, assume NEITHER plan changes the level of economic growth.

It sounds like your biggest beef is with the economic growth assumption...i.e..that there will be no difference between each plan. How is this not a reasonable assumption? Economic growth over the last two presidential administrations have remaind fairly constant. And both instituted strikingly divergent economic philosophies.

The conclusion of impact on deficits compounds the above error by assuming both candidates spending plans will be equal. Clearly that is not the case.

To me, the bigger error is assuming both candidates with have the same plan for troop withdrawal in Iraq. This is a $10 Billion/month bill we are paying that has been basically factored out of the calculations. It also needs to be factored in the spending that will occur under the McCain plan as well. The biggest difference from McCain is the earmark issue, which comes out to be less than a 1% saving on total government spending. It is perfectly reasonable to question Obama's spending and I agree it is excessive, but McCain isn't some maverick that is going to go in and cut spending significantly either.

 

[rjd970]

You stated there was no advantage between McCain and Obama's tax plan so how then will Obama give us a different result than Bush's when he and McCain are so similar. Follow this logic on the tax plans and you come up with: McCain= Bush= Obama as far as taxes go.

I only said there was no difference on the spending side. Obama's does, however, create more revenue and provide tax relief for more people, and maybe his spending plans offset this...I can concede that. But McCain's plan provides more tax relief for less people, and does nothing for increasing revenue...and I can concede McCain may spend less. I would say...of course based on what we are told by both candidates are saying....that when spending is factored in it is basically a wash.

I don't know, maybe what we need is an Obama tax policy and a McCain spend policy.

 

[BigPapaVol]

So exactly what are those differences, especially with tax policy? I'm all ears. This isn't a talking point, it is what it is.

-McCain plans to make the Bush tax cuts permanent and add more cuts for the upper income bracket including capital gains and corporate profit tax cuts. No billionaire left behind policy continued.
There isn't a snowballs chance in hell that any tax cuts for the wealthy are getting approved by this congress, period. If they do, our employment rates are better when our wealthy aren't shipping bid cash to Uncle Sam. Forget all of the other. Rich people investing is the lone way that we generate jobs as an economy. There is absolutely no other way to done. None, nada, zip, zilch. OBTW, said investment also fuels R&D and maintains our general technological competitive advantage around the world. There is no other way to view it, unless, like most heart bleeders, you think that's a government function.

-McCain plans to maintain the Bush energy policy with continued benefits for the oil industry while at the same time allowing alternative energy programs to expire by failing to show up to vote for the program ... multiple times. No oil executive left behind continued.
this silly red herring has been blasted forever ago. Did you see what he failed to vote for? You're pretending is something of merit. Plus, apparently you're advocating making life tough for the oil companies, as if our current policy of fixed margins for them isn't enough. Pretending that we're going to suddenly become less dependent on oil is a fantasy island concept. Further, pretending that there isn't a huge pile of smart money chasing a solution is just absurd.

-War on terror. McCain plans to continue Bush policies.
As he should, with the caveat that he be more aggressive.
-Foreign affairs. McCain plans to continue Bush policies.
which ones and what's the problem?

-Health Care. Bush plan revised.
any stance that doesn't publicize medicine is the right one.
-Social Security. Bush plan, revised
and we should absolutely move toward privatization for several reasons, the main one being that the gov't gets less money to piss away and it represents more of the big I in the GDP equation.

Read all about it:

JohnMcCain.com - McCain-Palin 2008

When you actually go to his campaign site and read his plans, they are basically updated versions of the '00 and '04 Bush plans. We're involved in extremely expensive conflicts in Iraq and Afghanistan as well as the war on terror. We have alienated our closest friends and allies. We have massive corruption in our government, a $4.4 trillion increase in our debt, record annual deficits, increased inflation and unemployment, and, now, $816 Billion in bail-outs socializing much of the U.S. banking system.

See bold.

The final paragraph is simply the Obama talking points Chicken Little act.

Iraq and Afghanistan have cost enormous money and being the world hegemon clearly has costs. Not even you can debate Afghanistan. Iraq is a long term strategic fight, with or without WMDs.

Alienation of allies? Who? How? Why? Don't bother, that's just a Hollywood democrat talking point. It's generally for those too stupid to understand what they're actually saying.

Massive corruption and it's all Republican and GWB's issue? Obama's gonna fix that because he's a Washington outsider? Biden begs to differ.

Socialization of the banking system is garbage. Every one of those deals is an earnout. The Fannie, Freddie disaster is just bailing out two government entities that have been shoddily run and aiming at the wrong end. Regardless, the overheated housing market and shoddy lending practices that helped it get there are coming home to roost. Addressing that in the market, a la the S&L crisis, is probably appropriate at this point.

 

[volinbham]

It sounds like your biggest beef is with the economic growth assumption...i.e..that there will be no difference between each plan. How is this not a reasonable assumption? Economic growth over the last two presidential administrations have remaind fairly constant. And both instituted strikingly divergent economic philosophies.

If fiscal policy enacted via taxes has no economic impact why is it such a widely used economic tool?

Do you believe that altering something like the corporate tax rate would not impact the rate of economic growth.

Finally, growth over 8 years may revert to a mean of about 3 - 4% however we see that the Clinton administration experienced hyper-growth followed by a recession. Most economists agree that the Bush tax cuts did indeed lessen the recession and re-energize economic growth. Fiscal policy does impact economic growth.



To me, the bigger error is assuming both candidates with have the same plan for troop withdrawal in Iraq. This is a $10 Billion/month bill we are paying that has been basically factored out of the calculations. It also needs to be factored in the spending that will occur under the McCain plan as well. The only thing different from McCain is the earmark issue, which comes out to be less than a 1% saving on total government spending. It is perfectly reasonable to question Obama's spending and I agree it is excessive, but McCain isn't some maverick that is going to go in and cut spending significantly either.

On the troop withdrawal, even Obama's plan stretches across years and does not completely reduce the investment in military for Iraq - his pull back strategy would still be a costly effort.

Here's the distinction - McCain may reduce spending by a small amount or it may remain neutral. However, Obama's own plans show significant increases in spending.

So, the TPC view of no growth differences between the plans and no spending differences between the plans is inadequate in projecting deficits since it holds constant 2 of the 3 components necessary.

 

[volinbham]

Obama's does, however, create more revenue

Again, this is based on a key assumption that his tax plan will not negatively affect economic growth.

If it does slow growth more than McCain's does then he doesn't create more revenue.

That assumption is critical to believing the TPC projections.

Add to that the additional spending you concede to Obama and you may begin to see why the TPC report isn't the authority it appears to be.

 

[rjd970]

Again, this is based on a key assumption that his tax plan will not negatively affect economic growth.

If it does slow growth more than McCain's does then he doesn't create more revenue.

That assumption is critical to believing the TPC projections.

Add to that the additional spending you concede to Obama and you may begin to see why the TPC report isn't the authority it appears to be.

No argument from me. But give me a reason to believe it will negatively affect economic growth. Historical evidence is on the side that neither plan will significantly affect economic growth.

Here's the distinction - McCain may reduce spending by a small amount or it may remain neutral. However, Obama's own plans show significant increases in spending.

You've said 3/4 of what I have said, but you are leaving out that Obama's plan also shows increase in tax revenue. I still say that it may all be a wash.

McCain = Neutral spending with less revenue
Obama = More spending with more revenue

...where the difference is more people see a tax cut under Obama.

 

[BigPapaVol]

No argument from me. But give me a reason to believe it will negatively affect economic growth. Historical evidence is on the side that neither plan will significantly affect economic growth.

Reagan's tax cuts showed beyond a shadow of any doubt that taxation levels and government receipts share an inverse relationship.



You've said 3/4 of what I have said, but you are leaving out that Obama's plan also shows increase in tax revenue. I still say that it may all be a wash.

but you can't say that given that the impact on the economy drives the level of revenues.

McCain = Neutral spending with less revenue
Obama = More spending with more revenue

again, the only part of either of these equalities up for debate is the more or less revenue. The one that has been proven wrong is the more revenue.

...where the difference is more people see a tax cut under Obama.

final statement is simply politician vote garnering via class warfare. Nothing more.

 

[volinbham]

No argument from me. But give me a reason to believe it will negatively affect economic growth. Historical evidence is on the side that neither plan will significantly affect economic growth.



You've said 3/4 of what I have said, but you are leaving out that Obama's plan also shows increase in tax revenue. I still say that it may all be a wash.

McCain = Neutral spending with less revenue
Obama = More spending with more revenue

...where the difference is more people see a tax cut under Obama.

The second comment first - the assertion that Obama's plan will generate more revenue is not supported because of the impact on growth and the focus of the burden on a small percentage of tax payers.

Historical evidence suffers from a regression to the mean problem. Hiking business taxes, the capital gains tax and tax on the wealthy could substantially negatively affect economic growth in the short term. Just as the Bush tax cuts stimulated growth for a few years, Obama's plans could stall growth for the short term.

Alternatively, reducing business taxes alone could spur economic growth in the next few years. Growth rate is but one part of the picture - the base on which the growth occurs is also important. If Obama's policies slow or reverse growth, future growth could be coming off a reduced base.

Additionally, a recession could reduce the income of the top 5% which is where (presumably) Obama plans to reap his new revenues. Since the source of revenues is so narrowly focused, any disruption here would have major effects.

 

[BigPapaVol]

The second comment first - the assertion that Obama's plan will generate more revenue is not supported because of the impact on growth and the focus of the burden on a small percentage of tax payers.

Historical evidence suffers from a regression to the mean problem. Hiking business taxes, the capital gains tax and tax on the wealthy could substantially negatively affect economic growth in the short term. Just as the Bush tax cuts stimulated growth for a few years, Obama's plans could stall growth for the short term.

Alternatively, reducing business taxes alone could spur economic growth in the next few years. Growth rate is but one part of the picture - the base on which the growth occurs is also important. If Obama's policies slow or reverse growth, future growth could be coming off a reduced base.

Additionally, a recession could reduce the income of the top 5% which is where (presumably) Obama plans to reap his new revenues. Since the source of revenues is so narrowly focused, any disruption here would have major effects.

regression to the mean? wow, that's salty.

The problem for Obama supporters is that there is no correlation between higher taxes and increased output, so his policies can't be at all responsible for improving the economy. There is, however, a very plausible argument that increased rates can hurt the economy. How's that for regressing to the mean?

 

[volinbham]

How's this for some mean regressing

Corporate taxes and economic growth

The Tax Foundation - Do Corporate Taxes Impede Economic Growth?

 

[volinbham]

More on corporate tax rates:

The Tax Foundation - What Do Corporate Income Taxes Cost American Families?

This article explains that every American pays business taxes regardless of whether he or she owns a business. In fact, in 2007 the average household shouldered a corporate tax burden of $3,190.

Apparently if you raise corporate taxes it gets passed through to consumers! Who'd have thunk it?

 

[BigPapaVol]

How's this for some mean regressing

Corporate taxes and economic growth

The Tax Foundation - Do Corporate Taxes Impede Economic Growth?

but that doesn't seem to mesh with Dio920's points.

 

[rjd970]

More on corporate tax rates:

The Tax Foundation - What Do Corporate Income Taxes Cost American Families?



Apparently if you raise corporate taxes it gets passed through to consumers! Who'd have thunk it?

Who said I agree with raising corporate taxes? Besides, this is an utter straw man, and I don't know why you have such a problem with Obama's stance on this. All he wants to do is adjust the top dividends and capital gains rate to something closer to - but no greater than - the rates Ronald Reagan set in 1986. And not only that, he isn't even going to raise these immediately, he is actually going to extend the current 2001 and 2003 cuts, he just won't make them permanent.

I just think, that when taken as a whole, the Obama plan makes more sense with the situation we are in right now. All he wants to do is reward work. Under the Bush and McCain plans, it is wealth that is rewarded. I don't necessarily agree with raising coroporate taxes and captial gains tax, but there needs to be some sort of balance between work and wealth and how they are taxed.

Under the Bush/McCain plan the top 1% get a tax cut twice as much as the middle class. BPV and the other neo-cons on here will inevitably convict me of class warfare, that is their mindless perogative, but when you have some hedge fund managers and CEO's making more in a day than some middle class make in a year, the gap is just too big. Warren Buffet even said it, 'If it is class warfare going on, my class is winning." The top 1% make craploads of money and I do believe they should pay a lower tax rate because they are paying the majority, but the rate is simply too low right now. Even Reagan wasn't this unreasonable.

Contrary to what you hear from the neo-cons, the backbone of the american economy is the working class, not the investors on wall street that get bailed out when they make bad investments. McCain has even said this.

 

[volinbham]

Who said I agree with raising corporate taxes? Besides, this is an utter straw man, and I don't know why you have such a problem with Obama's stance on this. All he wants to do is adjust the top dividends and capital gains rate to something closer to - but no greater than - the rates Ronald Reagan set in 1986. And not only that, he isn't even going to raise these immediately, he is actually going to extend the current 2001 and 2003 cuts, he just won't make them permanent.

I just think, that when taken as a whole, the Obama plan makes more sense with the situation we are in right now. All he wants to do is reward work. Under the Bush and McCain plans, it is wealth that is rewarded. I don't necessarily agree with raising coroporate taxes and captial gains tax, but there needs to be some sort of balance between work and wealth and how they are taxed.

Under the Bush/McCain plan the top 1% get a tax cut twice as much as the middle class. BPV and the other neo-cons on here will inevitably convict me of class warfare, that is their mindless perogative, but when you have some hedge fund managers and CEO's making more in a day than some middle class make in a year, the gap is just too big. Warren Buffet even said it, 'If it is class warfare going on, my class is winning." The top 1% make craploads of money and I do believe they should pay a lower tax rate because they are paying the majority, but the rate is simply too low right now. Even Reagan wasn't this unreasonable.

Contrary to what you hear from the neo-cons, the backbone of the american economy is the working class, not the investors on wall street that get bailed out when they make bad investments. McCain has even said this.

I'm not accusing you of having any position - I'm sticking with the theme of tax policy impact on economic growth and the relative merits of the 2 candidates plans.

Obama plans to raise corporate taxes, McCain wants to cut them. Two critical points here:

1. The different approaches to corporate taxation will most certainly impact economic growth differently. As a result, the TPC analysis misses the mark in alleging the deficit/debt impact.

2. Since corporate taxes are passed through, Obama's raising will amount to a tax increase on consumption - I don't know if it will mitigate his other cuts but it will dampen them. Alternatively, McCain's cuts in corporate taxes will likewise pass through to consumers of all income groups - in effect, it is a tax cut.

So, the TPC analysis underestimates the true tax benefit to all income groups for McCain's plan and overestimates the true tax benefit for Obama's. Additionally, it is off for McCain relative to Obama on deficit impact because it fails to recognize that McCain's could generate more economic growth (thus more revenue) and assumes spending would be equal between the two (which underestimates the deficit effect of Obama's).

I could see a compromise between the 2 plans but as they stand now, I prefer the McCain approach (though my taxes would likely be lower under Obama's).