Analysis of the GOP alternate 'budget'

[Armand Tanzarian]

www.ctj.org/pdf/housegopplan20090327.pdf

No surprise there:

# Over a fourth of taxpayers, mostly low-income families, would pay more in taxes under
the House GOP plan than they would under the President’s plan.
# The richest one percent of taxpayers would pay $100,000 less, on average, under the
House GOP plan than they would under the President’s plan.
# The income tax proposals in the House GOP plan, which is presented as a fiscally
responsible alternative to the President’s plan, would cost over $300 billion more than
the Obama income tax cuts in 2011 alone.

If you recall, the republicans proposed a very, VERY simple tax code. That was really the only substantiative item in the 19-page outline. Specifically, anyone earning under $100,000 would pay 10%, and everyone else would pay 25%. The analysis states that while 60% would pay less taxes, most of those are among rich people, and there is so far no plan to offset the effects of the $300 billion extra cost.

We're still waiting for the April 1 unveiling of the 'real' budget of course.

[m52nickerson]

Obama played the GOP like a fiddle in getting them to write there own budget. It really take the heat off his.

[Green-Eyed Lilo]

Bless their hearts, they tried to look like they have an idea or two between them.

[ltfred]

I thik there is something shortsighted about criticising Republicans for being less supportive of low taxes and low debt than the Democrats. That argument says "Yes, tax cuts are the answer, but Republicans don't want the right ones," and "This crisis was caused by the deficit caused by the Republicans." Both of which are incorrect and damaging when you turn around and try to raise taxes and the debt in six months in an attempt to fix the recession. Debt is a vital solution for a recession, and lower taxes have almost no stimulatory effect on the economy.

There is a line of argument that can work- "These priorities are so obviously incorrect that not even the people arguing for their achievement want to achieve them."

[dantesvirgil]

They're unveiling the full thing on April Fool's Day? Srsly?

[Vene]

Mar 30, 2009 13:34:34 GMT -5 dantesvirgil said:

They're unveiling the full thing on April Fool's Day? Srsly?

It's things like this that make me wonder if there really is a higher power.

[erictheblue]

Mar 27, 2009 22:44:03 GMT -5 ltfred said:

I thik there is something shortsighted about criticising Republicans for being less supportive of low taxes and low debt than the Democrats.

As was stated in the OP, the Repub plan would increase the deficit.

That argument says "Yes, tax cuts are the answer, but Republicans don't want the right ones" and "This crisis was caused by the deficit caused by the Republicans."

OK, so who is responsible for the crisis? The Dems, who haven't been in power in 8 years, and under whom we had a budget SURPLUS? Or the Repubs who have been in power for 8 years?

Both of which are incorrect and damaging when you turn around and try to raise taxes and the debt in six months in an attempt to fix the recession. Debt is a vital solution for a recession, and lower taxes have almost no stimulatory effect on the economy.

There is more to Obama's plan than lowering taxes. (That's what Bush did.) The President's plan has a lot of spending aimed at improving the national economy (a la "The New Deal").

[ltfred]

Mar 30, 2009 16:19:21 GMT -5 erictheblue said:

Mar 27, 2009 22:44:03 GMT -5 ltfred said:

I thik there is something shortsighted about criticising Republicans for being less supportive of low taxes and low debt than the Democrats.

As was stated in the OP, the Repub plan would increase the deficit.

And that doesn't matter. Bigger deficits are good. As you'd know if you read my post, my problem isn't with the facts, it's with the assumptions behind the OP. The assumptions are: tax cuts good, debt bad. Those assumptions (and a lot of other events and decisions) are what got us into this mess.

Mar 30, 2009 16:19:21 GMT -5 erictheblue said:

[ OK, so who is responsible for the crisis? The Dems, who haven't been in power in 8 years, and under whom we had a budget SURPLUS? Or the Repubs who have been in power for 8 years?

There is no debt crisis. The crisis does not exist, so nobody is responsible for it. Even if there was a crisis (which there isn't) nobody must ever call it a crisis, since the only way to get out of recession (and therefore ultimately end the 'crisis') is to make this 'crisis' 'worse' temporarily. When the economy is back on solid ground, the the debt will be at crisis levels.

By calling the debt too big, you hand the Republicans a stick with which to beat you. When you want to solve the economy you'll need to go into debt, and the Republicans will say 'no we need to get out of debt like you said'. And then you won't be able to fix the economy, the exonomy will stagnate and the Republicans will win the next election and make sure this stagnation is permenant.

Mar 30, 2009 16:19:21 GMT -5 erictheblue said:

There is more to Obama's plan than lowering taxes. (That's what Bush did.) The President's plan has a lot of spending aimed at improving the national economy (a la "The New Deal").

And he looked rather silly after criticising the Republicans for insufficient tax cuts when he got up and didn't propose only tax cuts.

BTW, the word you want instead of 'improving' is stimulating. Spending has a stimulatory effect; it employs people in safe, regular work, causing them to spend money, which employs other people, who spend... and so on until the snd of the next buisness cycle.

[erictheblue]

Mar 31, 2009 1:14:12 GMT -5 ltfred said:

And that doesn't matter. Bigger deficits are good. As you'd know if you read my post, my problem isn't with the facts, it's with the assumptions behind the OP. The assumptions are: tax cuts good, debt bad. Those assumptions (and a lot of other events and decisions) are what got us into this mess.

My bad. I thought you were writing in general terms, rather than specific.

[m52nickerson]

Mar 30, 2009 13:34:34 GMT -5 dantesvirgil said:

They're unveiling the full thing on April Fool's Day? Srsly?

At this point that only way they may look better is if they came out at the press conferance and just said "April fools" then walked out.

[machiavelli]

Mar 31, 2009 1:14:12 GMT -5 ltfred said:

And that doesn't matter. Bigger deficits are good. As you'd know if you read my post, my problem isn't with the facts, it's with the assumptions behind the OP. The assumptions are: tax cuts good, debt bad. Those assumptions (and a lot of other events and decisions) are what got us into this mess.

Actually, deficits/debts can be a bad thing when the state is left to resort itself to the printing press. It can lead to inflation and most importantly currency devaluation, which in the end would further cause inflation.
I am not sure if that's what the US govt is currently doing as the news reports are mixed on this matter. Ive read that China is fed up with constantly buying US debt, but it's not like they have much of a choice seeing as how the two economies are so interlinked.

I would also argue that deficits/debts are wasteful when they are spent propping up companies that should have died by now (I.E Zombie companies). They scare away any potential investors within that sector and are, for the most part, a giant monetary sink-hole.

[dantesvirgil]

Mar 31, 2009 6:39:51 GMT -5 m52nickerson said:

Mar 30, 2009 13:34:34 GMT -5 dantesvirgil said:

They're unveiling the full thing on April Fool's Day? Srsly?

At this point that only way they may look better is if they came out at the press conferance and just said "April fools" then walked out.

Please, please, please, FSM, let this happen!!


*Also, I see we have "machiavelli" joining us. I think I got a shiver.

[machiavelli]

Mar 31, 2009 8:09:33 GMT -5 dantesvirgil said:

Mar 31, 2009 6:39:51 GMT -5 m52nickerson said:

At this point that only way they may look better is if they came out at the press conferance and just said "April fools" then walked out.

Please, please, please, FSM, let this happen!!


*Also, I see we have "machiavelli" joining us. I think I got a shiver.

As the old Mach himself wrote... It's good to be feared
Muhaha *evil grin*

[CtraK]

Mar 31, 2009 12:19:32 GMT -5 machiavelli said:

As the old Mach himself wrote... It's good to be feared
Muhaha *evil grin*

So...you see yourself as more The Prince than the Discourses on Livy?

[ltfred]

Mar 31, 2009 7:09:11 GMT -5 machiavelli said:

Mar 31, 2009 1:14:12 GMT -5 ltfred said:

And that doesn't matter. Bigger deficits are good. As you'd know if you read my post, my problem isn't with the facts, it's with the assumptions behind the OP. The assumptions are: tax cuts good, debt bad. Those assumptions (and a lot of other events and decisions) are what got us into this mess.

Actually, deficits/debts can be a bad thing when the state is left to resort itself to the printing press. It can lead to inflation and most importantly currency devaluation, which in the end would further cause inflation.

Which will be a minor problem in twenty years, if we don't solve it when we can. We can't and shouldn't do anything about it right now.

BTW, if you're a third world country, debts are really, really bad.

Mar 31, 2009 7:09:11 GMT -5 machiavelli said:

I would also argue that deficits/debts are wasteful when they are spent propping up companies that should have died by now (I.E Zombie companies). They scare away any potential investors within that sector and are, for the most part, a giant monetary sink-hole.

Then the debate is not one about deficits, but about what is the most effective stimulus. I think spending on public works works best.