Taxes and the Bail Out

UserGoogol said:
Bringing my attention back to the original point, isn't it basic Keynesianism that when the economy goes into a recession the government should engage deficit spending to counteract that? Admittedly we're stuck in an "all deficit spending all the time" mode which is certainly not ideal, but raising taxes and decreasing spending seems like it would be a rather bad idea.
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Deficits are already running in the 433B range. I think the last conservative estimate was that either candidate would basically add another 400B to the deficit.

I think we may already be too deeply overextended to spend our way out. Deficit spending is used as a stimulus since the governement can begin projects that hire people and create opportunities. However, if it were the case that deficit spending made economies better, then we would all be sipping martinis and eat things flavored with white truffle right now the way ours is already spending.
 
Ziggurat said:
I hear you, Comrade! Death to the capitalist swine!
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Nah. I don't want to line them up against the wall and shoot them (most of them, anyway.) I just want them to contribute to the well-being of the nation or get out of the way of those that do.

(Leave the checkbook when you leave the country, okay?)
 
Ziggurat said:
You've got to be kidding. Democrats protected Fannie and Freddie when signs of trouble started appearing, and helped STOP regulators from cracking down on both companies. And it was primarily democrats who pushed banks to make bad loans under a progressive agenda to try to increase home ownership among the poor in the first place. It was a well-intentioned but ultimately disastrous attempt at social engineering, further exacerbated by political corruption. It was NOT a free-market melt down OR a case of under-regulation. Freddie and Fannie were set up the way they were with the explicit intention that they NOT act like free-market actors, and the damage caused by the Community Reinvestment Act cannot be laid at the feet of under-regulation.
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I see you have been reading the GOP talking points memo. Let me ask you, when was CRA enacted? How many of the failed mortgages were actually given out by organizations that fell under the purview of CRA regulations? I think you will be surprised by the answer which shows that CRA has little to no effect on the current situation.
 
Lurker said:
I see you have been reading the GOP talking points memo. Let me ask you, when was CRA enacted?
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Originally in 1977. But it has been modified rather heavily, including most importantly in 1995:
"The CRA regulations were substantially revised - using federal home-loan data broken down by neighborhood, income group, and race; encouraging community groups to complain to banks and regulators when banks did not meet their CRA obligations; allowing community groups that marketed loans to targeted groups to collect a fee from the banks just like other loan product marketers.
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During March 1995 congressional hearings William A. Niskanen, chair of the Cato Institute, criticized the proposals for political favoritism in allocating credit and micromanagement by regulators, and that there was no assurance that banks would not be expected to operate at a loss. He predicted they would be very costly to the economy and banking system, and that the primary long term effect would be to contract the banking system."

Which is exactly what happened. It just took until the housing bubble these changes (along with the actions of Fannie and Freddie) helped create to burst before the house of cards collapsed.

How many of the failed mortgages were actually given out by organizations that fell under the purview of CRA regulations?
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From that link: "[Michael S. Barr] noted that approximately 50% of the subprime loans were made by independent mortgage companies that were not regulated by the CRA. Another 25% to 30% came from only partially CRA regulated bank subsidiaries and affiliates. He stated that institutions fully regulated by CRA made "perhaps" one in four sub-prime loans."

That's a substantial chunk, and I think it's rather fair to consider the partially CRA regulated banks as being affected as well.

I think you will be surprised by the answer which shows that CRA has little to no effect on the current situation.
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It's funny that you accuse me of reading GOP talking points. But if you actually look at what I actually wrote, you'll see that I wasn't only talking about the CRA (which I didn't mention explicitly in the part you quoted), I was also (and in fact mostly) talking about Fannie and Freddie, which are not part of the CRA. By buying up sub-prime mortgages, they encouraged banks to make more bad loans. And you haven't touched on that aspect at all. Perhaps you're just responding with Democratic talking points.
 
UserGoogol said:
That idea is that without an army, (or more generally, a stable government protecting your stuff) barbarians would be at the gates taking rich people's stuff, I suppose. The richer you are, the more stuff you have to be taken, and thus the more you benefit from these basic services.
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Nope.

  • Barbarians at the gate haul off all the grain stored.
  • Grain was owned by rich people.
  • Everyone starves.
Ziggurat said:
It's funny that you accuse me of reading GOP talking points. But if you actually look at what I actually wrote, you'll see that I wasn't only talking about the CRA (which I didn't mention explicitly in the part you quoted), I was also (and in fact mostly) talking about Fannie and Freddie, which are not part of the CRA. By buying up sub-prime mortgages, they encouraged banks to make more bad loans. And you haven't touched on that aspect at all. Perhaps you're just responding with Democratic talking points.
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Unpleasant truths for "progressives".
 
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Ziggurat said:
Are you suggesting I should leave the country?
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I am suggesting that if you want to live here and use the infrastructure that government provides, you have an obligation to put back into the system in proportion to your use of and benefit from the infrastructure.

Pay your utility bills or move on.
 
mhaze said:
Nope.

  • Barbarians at the gate haul off all the grain stored.
  • Grain was owned by rich people.
  • Everyone starves.
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The rich also have an obligation to the common people who did the actual labor to produce the grain in the first place. They didn't get rich on their own labor, for the most part. Since the landowners need the labor of the working class to get rich in the first place, it is their obligation and it is in their best interest, to assure that the field workers are protected, too, both from barbarians and from rival feudal lords.
 
leftysergeant said:
I am suggesting that if you want to live here and use the infrastructure that government provides, you have an obligation to put back into the system in proportion to your use of and benefit from the infrastructure.
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And on what basis do we decide my proportion of use of government services? You've GOT to be kidding me if you think any such analysis is actually performed in order to determine tax rates.
 
leftysergeant said:
How much money did you make last year comapred to everyone else in the country?
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You're claiming that people use government services in direct proportion to how much money they make? Sorry, but that's simply not true. In fact, one of the central justifications for progressive tax codes and entitlement programs is that people near the bottom may need more in government services than they earn.

Not exactly rocket science, is it?
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No, it isn't. Rocket science is real. You're just making stuff up.
 
Ziggurat said:
In fact, one of the central justifications for progressive tax codes and entitlement programs is that people near the bottom may need more in government services than they earn.
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Balderdash. The top earners have benefitted at a greater rate than the bottom earners from the existance of the infrastructure and, in some cases, benefitted more from the fruits of some people's labors than do have those who labored.

A flat tax makes sense in an agrarian, more or less egalitartian society. In a capitalist society, any but a graduated tax just leads to the migration of all wealth to the hands of the crafty or well-born few.

In a capitalist society, how much you earn is a measure of the benefit you have derived from the existance of the infrastructure.
 
leftysergeant said:
Balderdash. The top earners have benefitted at a greater rate than the bottom earners from the existance of the infrastructure
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That doesn't contradict my argument in any way, shape, or form. Some of the bottom earners still consume far more in government services than they earn. Where does that money come from? Somebody has to be paying more for government services than they're getting. Whatever your arguments may be about whether or not it's the top earners, the fact remains: taxes ARE NOT levied in proportion to use of government services. And as a leftist, I would think you would realize that you shouldn't want them to be.

A flat tax makes sense in an agrarian, more or less egalitartian society. In a capitalist society, any but a graduated tax just leads to the migration of all wealth to the hands of the crafty or well-born few.
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Oh, but this is a different argument. It's got nothing to do with how much government services people use, but only with how you want wealth distributed. Whatever the logic or merits of that argument, it's got nothing to do with the connection between an individual's taxes and how much government services that individual consumes.

In a capitalist society, how much you earn is a measure of the benefit you have derived from the existance of the infrastructure.
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Only if you use that as your definition of how much we benefit from government services, otherwise there's really no way to establish such a claim. And how much you benefit from something isn't necessarily equal to how much of that thing you consume, and since you're so enamoured of the whole utility bill analogy, surely you must recognize that we don't get billed for how important our phone calls are, but for how much time we spend talking. And how much government services we consume is NOT well correlated with how much we earn. Hell, it's not even very well correlated with how much we benefit from them either, something which is rather easy to see by considering what happens if we become unemployed. Our consumption of government services may increase, and our benefit from them certainly doesn't vanish, even as our earnings plummet to zero.
 
"Government services consumed" includes all those inspectors and auditors that the investor class shriek about. Those are for our protection, but the investor class is stuck with the bill because they impose the need for the regulatory services.

What EPA services am I consuming? What EPA services is Boeing consuming?
 
Sounds like both candidates will increase your debt even more.

They are not likely to increase taxes or try to shake down the companies and individuals that have brought taxcuts over the last decades.
(how much of the bailout will disapear in someones pockets)

You may or may not get, a state bancrupcy, depending on wether the parasites can show restraint or will suck you to death.
 
leftysergeant said:
In a capitalist society, how much you earn is a measure of the benefit you have derived from the existance of the infrastructure.
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This is utter nonsense. I don't even think Karl Marx would have made such a claim.

In a capitalist society, how much you earn is a function of many things; primarily among them is your intelligence, your ability to find the best way to put your talents to use, your ambition, and your willingness and ability to work hard. There's a considerable amount of luck involved as well.

Government usually provides some level of opportunity for education, but it's entirely up to you to make use of that opportunity. The opportunities for employment and advancement are not provided by government, but nearly always by other capitalists who have trod whatever path you are on ahead of you. A few rare capitalists find new paths to open up to themselves and others.

Government does not provide me with my income. My income is derived from working for a big capitalist company that makes very good products that lots of people by. Government did not put this company into business, and government does not keep it going. This company exists because more than a century ago, a particularly clever capitalist by the name of Joseph A. Campbell came up with a new method of manufacturing and canning soup that made it possible to mass produce and sell high-quality soup and low prices. It wasn't any help from the government that turned this small humble company into one of the biggest food companies in the world. It was the fact that this company produced (and continues to produce) high-quality food products at very reasonable prices, and that people eagerly buy these products.

And it's not any help from the government that is helping me to succeed within this company, but my own cleverness, talents, and willingness to work.
 
leftysergeant said:
"Government services consumed" includes all those inspectors and auditors that the investor class shriek about.
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Way to not address the question. Do you deny that an unemployed person on welfare is consuming more in government services than they earn, let alone what they're taxed?
 
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