Those Tax-Cuts Don't Taste So Good Coming Back UP

[Nbadan]

Tax Cuts May Come At a Price, Study Says
Treasury: Financing Must Be Found
By Nell Henderson
Washington Post Staff Writer
Wednesday, July 26, 2006; Page D01


The federal government will need to either cut spending or raise taxes down the road to pay for extending President Bush's recent tax cuts, the Treasury Department said in a report released yesterday, dismissing the idea popular with many Republicans that such sacrifices can be avoided.

The Treasury report did not openly address the much-debated contention of many conservative analysts that the tax cuts will boost economic growth so much over time that the resulting increase in taxes paid will offset much or all of the initial loss in government revenue -- that tax cuts can essentially pay for themselves.

The report acknowledged the debate delicately, saying "the issue of how, or even if, these policies need to be financed remains a source of discussion among economists."

But the Treasury's view reflects "a recognition the federal government has to finance the tax relief" to avoid a rise in government debt, Robert Carroll, deputy assistant secretary for tax analysis, said in an interview.

The report stressed that the economic effects of extending the tax cuts "depend crucially on whether they are financed by lower spending or higher taxes in the future."...

Washington Post (http://www.washingtonpost.com/wp-dyn/content/article/2006/07/25/AR2006072501543.html)

Taxcuts for the wealthy in the middle of a war is never a good idea

[Obstructed_View]

Whoops (http://www.washingtonpost.com/wp-dyn/content/article/2006/07/25/AR2006072501101.html)

[Yonivore]

Whoops (http://www.washingtonpost.com/wp-dyn/content/article/2006/07/25/AR2006072501101.html)
The idiots on this forum can't seem to separate tax policy from federal spending habits.

The tax cuts have, irrefutably, increased federal tax revenues. Period. No argument.

I have no problem with the argument that they need to cut spending but raising taxes will only dampen federal income.

[Nbadan]

To achieve this positive economic benefit, the study assumes that beginning in 2017, government spending is reduced to pay for the tax cuts.

However, if Congress decided to boost other taxes to make up the lost revenue, the Treasury study estimates that the positive benefit to growth would disappear. Instead, it estimates that the higher taxes in other areas would reduce economic output, as measured by the gross domestic product, by 0.9 percent annually in the years after 2016.

So what the difference to what I posted? The FEDS need to cut spending or raise taxes, and this article says raising taxes will reduce economic output - duh! Kinda puts the US between a rock and a hard place.

[Yonivore]

So what the difference to what I posted? The FEDS need to cut spending or raise taxes, and this article says raising taxes will reduce economic output - duh! Kinda puts the US between a rock and a hard place.
The only real answer is to address meaningful entitlement reform. That's the only place where any substantial money can be regained.

Privatize Social Security. Cut the fraud and waste out of Medicare and Medicaid.

That'd save a buttload.

[Nbadan]

The idiots on this forum can't seem to separate tax policy from federal spending habits.

The tax cuts have, irrefutably, increased federal tax revenues. Period. No argument.

I have no problem with the argument that they need to cut spending but raising taxes will only dampen federal income.

Your right, if only closet Neocons would admit that this WH has strayed the furthest from Conservative traditon EVER!

[Nbadan]

The only real answer is to address meaningful entitlement reform. That's the only place where any substantial money can be regained.

Privatize Social Security. Cut the fraud and waste out of Medicare and Medicaid.

That'd save a buttload.

Entitlement reform? You mean like cutting VA benefits?

Yeah privatizing SS, because putting money in today's market is a safe bet.

:lol

[Yonivore]

Entitlement reform? You mean like cutting VA benefits?

Yeah privatizing SS, because putting money in today's market is a safe bet.

:lol
My 401K, Roth IRA, and Stock Portfolio are way outperforming my Social Security contributions.

[Spurminator]

Yeah privatizing SS, because putting money in today's market is a safe bet.

Maybe I'd like to make that decision for myself.

[Nbadan]

My 401K, Roth IRA, and Stock Portfolio are way outperforming my Social Security contributions.

..but your SS contributions are a sure thing. A safety net. You could possibly lose everything in your other investments, it's called risk, and its the reason your earning more in your individual investments.

[Yonivore]

..but your SS contributions are a sure thing. A safety net.
:lmao


You could possibly lose everything in your other investments, it's called risk, and its the reason your earning more in your individual investments.
If that happens, there won't be any Social Security either. Hell, put your money in an FDIC insured account at the bank and you'd be better off than gambling there will be a Social Security check for you when you retire.

[Spurminator]

It's a safety net with an expiration date unless we raise the retirement age. But how are you going to do that?

[Nbadan]

Maybe I'd like to make that decision for myself.


Think of it this way, your tax dollars help pay for the US. military incursions into other countries. Oh sure you could put your money in a fairly safe diversified portfolio and likely exceed the growth rate of government bonds and treasuries, but we'd all be speaking muslim.

[Nbadan]

It's a safety net with an expiration date unless we raise the retirement age. But how are you going to do that?

Well, those IOUs in the treasury are government bonds and treasuries, now let me ask you, if the U.S. defaulted on those notes what would happen to the dollar?

[Spurminator]

Think of it this way, your tax dollars help pay for the US. military incursions into other countries. Oh sure you could put your money in a fairly safe diversified portfolio and likely exceed the growth rate of government bonds and treasuries, but we'd all be speaking muslim.

I'm not against taxes. But Social Security should be about one's individual opportunities after retirement.

[Yonivore]

Think of it this way, your tax dollars help pay for the US. military incursions into other countries. Oh sure you could put your money in a fairly safe diversified portfolio and likely exceed the growth rate of government bonds and treasuries, but we'd all be speaking muslim.
That makes absolutely no sense.

[Nbadan]

That makes absolutely no sense.

Isn't that why we are in Iraq and Afghanistan, so we fight them there so we don't have to fight them here? How are we supposed to fight them there without a well-funded military? Sell more bonds?

[Yonivore]

Isn't that why we are in Iraq and Afghanistan, so we fight them there so we don't have to fight them here? How are we supposed to fight them there without a well-funded military? Sell more bonds?
We have a well-funded military. And, it will remain so.

[Nbadan]

I'm not against taxes. But Social Security should be about one's individual opportunities after retirement.

Most people have a pack mentality when it comes to investing and that can kill you in today's market. Oh sure, theoretically, it would be wonderful if everyone could manage their own retirement accounts, but many people are incapable.

[Nbadan]

We have a well-funded military. And, it will remain so.

We have a well funded military because the Saudis and the Chinese keep buying our government bonds, but that heavy borrowing comes at a premium diplomatic price. Who does our government represent, the will of the people or the will of the lender?

[Yonivore]

Most people have a pack mentality when it comes to investing and that can kill you in today's market. Oh sure, theoretically, it would be wonderful if everyone could manage their own retirement accounts, but many people are incapable.
So, let those who want to manage their own money do so and, let those who want the government to mismanage their money do so. I don't see the problem.

[Spurminator]

Most people have a pack mentality when it comes to investing and that can kill you in today's market. Oh sure, theoretically, it would be wonderful if everyone could manage their own retirement accounts, but many people are incapable.

They wouldn't have to. Privatization would create thousands of new jobs in Financial Management, and probably reduce the cost.

If you want to sit back and do nothing while the money comes out of your paycheck, it would still be an option. It's just no longer a requirement.

[Nbadan]

So, let those who want to manage their own money do so and, let those who want the government to mismanage their money do so. I don't see the problem.

The problem is is that your WH, with its conservative values, has spent all the reserves we are adding to the treasury, despite repeated promises by Dubya not to do so while he was campaigning, so withdrawing any additional funds or reducing the natural rate of increase in the fund would cripple it for the rest of us.

[Nbadan]

They wouldn't have to. Privatization would create thousands of new jobs in Financial Management, and probably reduce the cost.

If you want to sit back and do nothing while the money comes out of your paycheck, it would still be an option. It's just no longer a requirement.

All those financial managers would have to be paid, and you can bet that their paychecks would come out of your investments, increasing the rate of return you would have to earn at a minimum level to eveb meet the rate of return you already earn on insured government bonds.

[Yonivore]

The problem is is that your WH, with its conservative values, has spent all the reserves we are adding to the treasury, despite repeated promises by Dubya not to do so while he was campaigning, so withdrawing any additional funds or reducing the natural rate of increase in the fund would cripple it for the rest of us.
Last time I checked Congress held the purse strings of the government and were under no obligation to fund the Executive budget proposal. Indeed many federal spending initiatives -- proposed in the budget -- go unfunded while earmarks, amended to important legislation, constitutes a tremendous amount of the budget in the form of pork barrel spending for constituent pandering.

[Yonivore]

All those financial managers would have to be paid, and you can bet that their paychecks would come out of your investments, increasing the rate of return you would have to earn at a minimum level to eveb meet the rate of return you already earn on insured government bonds.
They don't cost that much.

[2centsworth]

All those financial managers would have to be paid, and you can bet that their paychecks would come out of your investments, increasing the rate of return you would have to earn at a minimum level to eveb meet the rate of return you already earn on insured government bonds.
Dan you don't believe anything you write. It's obvious your message is crafted to manipulate the uneducated.

[Obstructed_View]

If you can't dazzle them with brilliance, baffle them with bullshit.

[Spurminator]

:lol Yeah, dammit, I don't want to have to pay a Financial Manager, so I'm just gonna leave my money in a fund with negligible growth.

I'm also going to fire my advertising and buying agencies because they take commission.

[Nbadan]

Dan you don't believe anything you write. It's obvious your message is crafted to manipulate the uneducated.

Really? How so?

[Nbadan]

They don't cost that much.

Well, the real costs would be even higher interest rates for everybody. Remember back to economics 101, there is a finite amount of credit available in the world, so when the U.S. government has to borrow more, as would happen if everyone was allowed to draw a percentage of their retirement money from SS instead of the government borrowing it at a very generous interest rate, interest rates go up for all borrowers.

[Nbadan]

If you can't dazzle them with brilliance, baffle them with bullshit.

Blah, my critics have been saying the same for 3 year now, but they've yet to prove me wrong. Marcus Bryant? Travis? Yonivore? Father Garduchi? I'm still waiting.

[Yonivore]

Blah, my critics have been saying the same for 3 year now, but they've yet to prove me wrong. Marcus Bryant? Travis? Yonivore? Father Garduchi? I'm still waiting.
We don't have to. The economy proves you wrong every day.

[scott]

Last time I checked Congress held the purse strings of the government and were under no obligation to fund the Executive budget proposal. Indeed many federal spending initiatives -- proposed in the budget -- go unfunded while earmarks, amended to important legislation, constitutes a tremendous amount of the budget in the form of pork barrel spending for constituent pandering.

Last time I checked, the President held veto power and was under no obligation to fund the Congressional budget proposal. I'm glad he saved it to make sure that embryos get thrown in the trash can instead being used to cure disease though.

[ChumpDumper]

scott beat me to the veto feature by five hours.

[Yonivore]

Last time I checked, the President held veto power and was under no obligation to fund the Congressional budget proposal. I'm glad he saved it to make sure that embryos get thrown in the trash can instead being used to cure disease though.
Last time I checked much of the pork-barrel spending was attached as "earmarks" to legislation the President would have been foolhardy to veto (Things such as funding for military operations worldwide) and, which would have been overridden by Congress, anyway.

It is a red herring to say the President has much control over Congressional spending...except to say he could force a Congressional showdown and risk dangerous interruptions in essential funding by vetoing all the fat legislation and forcing the Congress to override. Now, give him the line item veto, and you'd be making some sense.

I do agree that he wasted political capital on using his first veto on a largely symbolic piece of legislation but, either way, it was a trap. Had he not vetoed, he would have been blasted for abandoning principle. He stood by his conviction on the matter. It was really a no win situation for the President.

[Yonivore]

Last time I checked, the President held veto power and was under no obligation to fund the Congressional budget proposal. I'm glad he saved it to make sure that embryos get thrown in the trash can instead being used to cure disease though.
Hey, scott. Here's an interesting set of commentaries on the recent ABA report blasting the President on signing statements. I'd be interested in your take.

STOLEN FROM POWERLINE BLOG (http://powerlineblog.com/archives/014817.php):


What about the merits of the signing statement issue? I think one needs to keep in mind that the president has a sworn duty to uphold the U.S. Constitution. This means that he must form opinions about what the Constitution means and act upon those opinions. The view I'm articulating is neither a radical nor a conservative view. I learned it from the late, great constitutional law scholar Gerald Gunther, who was neither radical nor conservative. And, as I said earlier, the Clinton adminstration recognized the president's duty to defend the Constitution on the many occasions when it used signing statements.

This view does not deprive the Supreme Court of the final say on matters of constitutional interpretation. Once the Supreme Court upholds the constitutionality of an enactment, it is the president's duty, in my opinion, to enforce that law. But in the absence of a Supreme Court decision, I believe that the president can and should refuse to enforce laws he considers unconstitutional and, in the interest of candor, should state that intention in advance. Doing so does not violate his duty to take care that the laws be fully executed because, as Ed Whelan points out, the Constitution is one of the laws (indeed, the supreme one) that the president must take care fully to execute.

The president does, however, have to power to veto legislation, and I agree with those who say that using that power (not a signing statement) ordinarily is the proper way for the president to defend the Constitution from legislation he thinks is clearly unconstitutional. A signing statement might well be the better response in the case where Congress passes legislation the enactment of which cannot wait, even though it has an unconstitutional provision. But absent special circumstances, the best course is to use the veto power. If Congress overrides the veto, however, the president is back to square one and, if he considers the legislation unconstitutional, he has the right to so state and to instruct the executive branch accordingly.

Signing statements also can be used when Congress passes legislation that the president believes is constitutional if construed one way but unconstitutional if construed another. Here, it is proper for the president, rather than vetoing the legislation, to construe it in the "constitutional" way, and to explain what he is doing. This course is similar to the Supreme Court's practice of construing laws in ways that make them consistent with the Constitution, and upholding them on that basis. When reviewing a statute which the president signed into law only after construing it through a signing statement, the Supreme Court can consider the president's construction of the law for what it thinks it's worth.

One of the other bloggers (Ed Whalen at NRO's Bench Memos) to which Powerline links deconstructs the ABA's argument here (http://bench.nationalreview.com/post/?q=Mzk2NDY0OWY2YTdjZTYwZWVlMDg1MzJlMzljYThlNDY=), here (http://bench.nationalreview.com/post/?q=MTQ3ZjA3MmM2ZjJiMWVhYmE1MjQ4NmVjYmFjNDVjNjg=), and here (http://bench.nationalreview.com/post/?q=OWJmNTI5NWQ0YzA0MzAzYWVkNTdlODJkNjQwNGJjMjM=). A couple of salient points:


The ABA task force’s central conclusion is that the President’s only choice, when presented a bill that has a provision that he believes is unconstitutional, is to veto the bill. Here’s the task force’s reasoning (on pages 18-19): (A) The Presentment Clause (Article I, section 7, clause 2) provides that every bill which shall have passed both houses of Congress shall be presented to the President for signature or veto. (B) Under the Take Care Clause (Article II, section 3), the President “shall take Care that the Laws be faithfully executed.” (C) Therefore, the President is obligated to faithfully execute all bills that become law; he may not sign a bill into law and refuse to enforce one of its provisions.

The problem with this reasoning is that proposition C does not follow from A and B. The easiest way to recognize this is to understand that the Constitution is one of the “Laws” that the President “shall take Care … be faithfully executed.” Thus, when a bill has become law, the President has an obligation under the Take Care Clause not to enforce provisions of that bill that are unconstitutional. That is true whether he has signed the law, whether it has been enacted in an override of his veto, or whether it was enacted before he became President. In those cases in which he has signed the law, a signing statement is one proper means of fulfilling his Take Care obligation.

When the President faces a massive appropriations bill that includes one indisputably unconstitutional provision (such as a legislative veto that violates Chadha), the task force’s position is that the President’s only constitutional option is to veto the entire bill. The task force acknowledges (on page 23) “the rare possibility that a President could think it unavoidable to sign legislation containing what he believed to be an unconstitutional provision.” But it still maintains that it is unacceptable for the President to sign the bill and address the unconstitutional provision in a signing statement. This position is unworkable, if not crazy. The situation described by the task force is routine, not rare. For example, virtually every appropriations bill contains a provision that violates Chadha. The task force’s position would lead, at best, to an insane game of chicken between the President and Congress and, quite probably, to a collapse of governmental operations. [Which, I believe was one of the points I was trying to make. -- Yonivore] Is anyone on the task force awake and sentient?