Thank you so much Bighog, that summarizes nicely the problem with Phil Gramm, and why McCain selecting him as his economic advisor, and conceivably Treasury secretary, scares the living bejesus out of me. .
OK, first about the taxation issue. We could argue about that one till we are both blue in the face, would get us nowhere. I am actually an economist, holding 3 separate degrees, so you don't need to explain indirect taxation to me. The timing for expanding the government and direct taxation; however, could not be worse. We need to cut spending deeply. Now. Lets just say we disagree on that one. As for editing Wikipedia, that doesn't make sense as the topic would constantly have different definitions, etc. Could be true however as I rarely look at it. This was just the first article I grabbed when I did a quick google search on Reagan + cold war, so I could throw out some ammo other than my opinion. There were dozens of articles there. Honestly, you are the first person I have ever heard of, who is of the opinion that the quick US military buildup didn't have anything to do with the end of the Cold War. Again, it would be a waste of time trying to convince you otherwise, so I am going to drop it. Middle class and stocks. This may just be anecdotal, but damn near everyone I know owns stocks outside of IRA's. My friends and family are middle class. And finally, thousands of traders will be absolutely screwed by the changes in cap gains. I am primarily a day trader, but 60% of my income is taxed at long term cap gains rates. I will see a massive income tax rise. Means little to the country as a whole of course. Just replying to your statement how traders wouldn't be affected. They will.
Thank you, Jayford, for your germane response. I could well be wrong about the fraction of the population that owns significant amounts of stock outside of retirement accounts. You'll be surprised to learn that i agree with you that what is needed are deep spending cuts. And it's my guess that we would even agree that the rate at which we cut has to be carefully considered so as not to create chaos and unintended consequences, such as massive unemployment. We might disagree though on where those cuts should be focused. My thinking is that we should make cuts in investment last and cut spending on wasting assets first. Thus i would want to adopt a new paradigm with regard to military spending. I would change the political mantra of "strong military" to "adequate military". I see no logical or practical advantage to spending more on military than all other nations on Earth combined! That makes no sense to me, and as an economist, i would hope you would agree. Thus i would make military cuts a priority. And i would put expenditures on infrastructure and health much further down on the list, and cuts in education spending dead last, though i certainly would not argue with those that maintain that the Department of Education could do with some changes. I would divert much of the savings from cuts in military expenditure to infrastructure and expect the military-industrial complex to refocus their efforts toward building infrastructure. As an example, the same contractors that design and build weapons obviously have the engineering knowhow to build a high-speed passenger rail system. Another place where huge savings could be realized is by doing away with the notably unsuccessful "war on drugs" I would decriminalize drug use, as the more forward looking societies have, and treat it as a health problem. It is estimated that something like 90% of crimes are drug related. If we could cut that figure by just half, think of the savings that could be realized in the courts, in prisons, and in society that would benefit hugely from a much lower crime rate. We're wasting huge resources on victimless crimes. And if drugs were decriminalized we could expect a very large drop in the number of crime victims as well. We are our own worst enemies when it comes to drugs and our drug policies. I would revise the farm program from one of one-directional money flow to one of two-directional flow. Thus prices would be brought up to parity when they are below, but the tax revenues used to do that would be paid back in times of plenty when world prices rise above parity. I would do exactly the same thing with gasoline taxes, so that the tax would decrease when world market prices are above parity, but increase when gasoline prices fall below parity. Though I am very much a libertarian when it comes to personal freedoms, I disagree with the libertarians when it comes to the economy. I haven't seen any evidence that a laissez faire economy works well in a complex society, though in an ideal world with perfect people it might. In the real world, which is filled with imperfections, laissez faire leads to boom, bust and chaos. Another place we would very likely disagree is with regards to social security. I consider that to be a highly successful, well-thought-out, and highly efficient government program. The defined benefit aspect of this program provides for those of modest means to be guaranteed at least a subsistence retirement that they can not outlive and could never have achieved through totally private, individual investment. This is possible because those who live long are supported by the contributions of those who do not. The system has been self supporting through the social security payroll tax and is very efficiently administered. I would not want to change it, but rather just tweak it so it is sound into the future. I would do that through a combination of increased contributions and by raising the income cap, with emphasis on the latter, because wages at the bottom are so low that they cannot support much of an increase in the payroll tax. I would address the problem of medicare and medicaid by breaking the cartel and thus introducing competition. That would have to come from deregulation that currently protects the cartel and its vested interests. FDA/Big Pharma, Big Insurance/AMA and AHA be damned. I have no objection to carnivals and sporting teams operating as cartels, but they don't, of course, because their customers can walk. So why on earth do we let our medical system operate as a cartel, where you can't walk out the door? Where is the logic in that? Finally, I strongly disagree with those who trumpet the mantra "the government does nothing efficiently or well." There are a number of functions, that as far as i'm concerned, the government excels at, as well of course, some where it fails dismally. It's a mixed bag. Let's change what needs to be changed and build on the strong areas. And lets do make deep cuts in spending.
I'd be way more comfortable with McCain if he'd assure me, in some way (it has to be real assurance), that he'd get back to Reagan-esque military policies of NOT engaging in preemptive war. No, I'm not speaking of Afghanistan. Destroying the network of bases and the infrastructure of the Taliban was the right thing to do there in response to the 9/11 attacks, even if we didn't have 1000% certainty at the time that the plans were hatched and developed there at the time we went in. I'm speaking of Iraq. And Iran. We should not have gone into Iraq. Anyone with half a brain knows that. Colin Powell knew that, and said what he was chosen to read at the U.N. was "bullshit" before he read it. But read it, he did. Iraq could have been dealt with the same way Iran is being dealt with. Isolation. Neither has the ability to attack the U.S. in any serious way, they could have/can both be contained, and if they did do something truly bold and brazen, that seriously adversely affected U.S. interests, then you use a measured response. The arguments from the hawks now, as then, are that they "can't be allowed to develop atomic technology." Sorry. That genie is out of the lamp. It started with Khan in Pakistan. You could strike Iran, and even the most brilliant U.S. military strategists in the Pentagon have said the best you could hope for is a setback of a few years to some of their progress, if that. And then you fuel even more discontent. And for what? I highly doubt Israel lacks the ability to defend itself adequately from Iran. It may be true that Israel has every reason to fear a growing Iran (and that Israel lacks the capacity to inflict serious damage on Iran's far flung and well entrenched facilities - unlike their bombing of Osirak in Iraq, which was precise, absolutely minimized civilian casualties, and was limited to a poorly defended, single installation), with growing influence in the region, much as the UAE and Saudi Arabia do, but the real politik is that you're not going to retard that progression without risking a whole chain of adverse and very serious world events, some of which we won't know about until after the fact. The military option is one fraught with incredible risks regarding Iran. Iran is much more complex than Iraq in terms of its synergies, politically, culturally, regionally and militarily. And look at what our mistake in Iraq is costing us, and for how long it will cost us. No. McCain needs to assure rational Americans a strike on Iran would probably only be warranted if Iran acted first. And I'm not talking about some bullshit, inflated, artificially created or flaunted event. That's my biggest problem with McCain. He should know better, as Reagan did, that enemies can be dealt with through carrots and sticks, and that the military stick should be the option of ultimate last resort - not to be even talked of casually. Just talking of it in a flippant way plays right into the Iranian regime's hands. It creates the perfect pretext for them to continue doing what they're doing, as they are able to persuade the fence sitters in their nation that their only security ticket is a real and viable nuclear weapons program.
I agree with most of your statements, but to go into each point would take more than my lazy ass wants to write at the moment. I am of the belief that large government programs screw up most of the areas they are involved with, and at the very least are extremely inefficient. Regulation is needed in places, but socializing everything as BO wants to do is not the answer. Military, infrastructure, and a social security net are some areas that have to be managed on a national scale. Most programs, however, are better implemented by the States or market. I am definitely against raising any taxes to add more bullshit to the overspending. As I have already mentioned, our current tax structure brings in incredible revenues. Lets leave it alone. We need a tax system that we stick to for the long term, not one that each admin tweaks. Makes long term investment planning ludicrous. So actually, I am against some things Mac wants to change (other than bringing corporate taxes down to the levels of the rest of the world). I am much more against what Obama wants to do; however, and in my opinion, it would be an economic disaster. As you say, we pay a high price in indirect taxation, but that will continue for awhile no matter what we do (lag effect). Add massive income tax increases to that, which are immediately felt and thus influence behavior immediately, and this poor indebted economy goes snap!
Surprisingly, we aren't far apart on the issues; yet we have reached different conclusions regarding which candidate would be best from our viewpoints. Well it should be an interesting political season in any case. Cheers, Piezoe
The lofty discourse above (excellent BTW) affords McCain nothing - he's still facing an angry runaway jury that's going to come back with a HUGE award against Reps this fall. Anger and blame is at play. Look at this article on Yahoo news today - think how easy it is to blame Reps for everything. If I have this dynamic right, something like Bush blaming Dems for our gas price woes last week just incenses the jury even more. "By ALAN FRAM and EILEEN PUTMAN, Associated Press Writers Sat Jun 21, 3:14 PM ET Is everything spinning out of control? Midwestern levees are bursting. Polar bears are adrift. Gas prices are skyrocketing. Home values are abysmal. Air fares, college tuition and health care border on unaffordable. Wars without end rage in Iraq, Afghanistan and against terrorism. Horatio Alger, twist in your grave. The can-do, bootstrap approach embedded in the American psyche is under assault. Eroding it is a dour powerlessness that is chipping away at the country's sturdy conviction that destiny can be commanded with sheer courage and perseverance. The sense of helplessness is even reflected in this year's presidential election. Each contender offers a sense of order â and hope. Republican John McCain promises an experienced hand in a frightening time. Democrat Barack Obama promises bright and shiny change, and his large crowds believe his exhortation, "Yes, we can." Even so, a battered public seems discouraged by the onslaught of dispiriting things. An Associated Press-Ipsos poll says a barrel-scraping 17 percent of people surveyed believe the country is moving in the right direction. That is the lowest reading since the survey began in 2003. An ABC News-Washington Post survey put that figure at 14 percent, tying the low in more than three decades of taking soundings on the national mood. "It is pretty scary," said Charles Truxal, 64, a retired corporate manager in Rochester, Minn. "People are thinking things are going to get better, and they haven't been. And then you go hide in your basement because tornadoes are coming through. If you think about things, you have very little power to make it change." Recent natural disasters around the world dwarf anything afflicting the U.S. Consider that more than 69,000 people died in the China earthquake, and that 78,000 were killed and 56,000 missing from the Myanmar cyclone. Americans need do no more than check the weather, look in their wallets or turn on the news for their daily reality check on a world gone haywire. Floods engulf Midwestern river towns. Is it global warming, the gradual degradation of a planet's weather that man seems powerless to stop or just a freakish late-spring deluge? It hardly matters to those in the path. Just ask the people of New Orleans who survived Hurricane Katrina. They are living in a city where, 1,000 days after the storm, entire neighborhoods remain abandoned, a national embarrassment that evokes disbelief from visitors. Food is becoming scarcer and more expensive on a worldwide scale, due to increased consumption in growing countries such as China and India and rising fuel costs. That can-do solution to energy needs â turning corn into fuel â is sapping fields of plenty once devoted to crops that people need to eat. Shortages have sparked riots. In the U.S., rice prices tripled and some stores rationed the staple. Residents of the nation's capital and its suburbs repeatedly lose power for extended periods as mere thunderstorms rumble through. In California, leaders warn people to use less water in the unrelenting drought. Want to get away from it all? The weak U.S. dollar makes travel abroad forbiddingly expensive. To add insult to injury, some airlines now charge to check luggage. Want to escape on the couch? A writers' strike halted favorite TV shows for half a season. The newspaper on the table may soon be a relic of the Internet age. Just as video stores are falling by the wayside as people get their movies online or in the mail. But there's always sports, right? The moorings seem to be coming loose here, too. Baseball stars Barry Bonds and Roger Clemens stand accused of enhancing their heroics with drugs. Basketball referees are suspected of cheating. Stay tuned for less than pristine tales from the drug-addled Tour de France and who knows what from the Summer Olympics. It's not the first time Americans have felt a loss of control. Alger, the dime-novel author whose heroes overcame adversity to gain riches and fame, played to similar anxieties when the U.S. was becoming an industrial society in the late 1800s. American University historian Allan J. Lichtman notes that the U.S. has endured comparable periods and worse, including the economic stagflation (stagnant growth combined with inflation) and Iran hostage crisis of 1980; the dawn of the Cold War, the Korean War and the hysterical hunts for domestic Communists in the late 1940s and early 1950s; and the Depression of the 1930s. "All those periods were followed by much more optimistic periods in which the American people had their confidence restored," he said. "Of course, that doesn't mean it will happen again." Each period also was followed by a change in the party controlling the White House. This period has seen intense interest in the presidential primaries, especially the Democrats' five-month duel between Obama and Hillary Rodham Clinton. Records were shattered by voters showing up at polling places, yearning for a voice in who will next guide the country as it confronts the uncontrollable. Never mind that their views of their current leaders are near rock bottom, reflecting a frustration with Washington's inability to solve anything. President Bush barely gets the approval of three in 10 people, and it's even worse for the Democratic-led Congress. Why the vulnerability? After all, this is the 21st century, not a more primitive past when little in life was assured. Surely people know how to fix problems now. Maybe. And maybe this is what the 21st century will be about â a great unraveling of some things long taken for granted."