I don't think that huge rate of homeownership in the US, nearing 70%, is an illusion. Out here in the fields, nothing gives one pride of place more - even if it is a low income setup, trailer, etc. ... I respectfully disagree. Look at what has happened to lending standards regarding homes. It has dropped dramatically. Combine this with a major decline in interest rates over the last 20 years, plus the Fannie Mae credit monstrosity (credit bubble?), and that equals a high homeownership rate. The numbers can be very deceiving. If you take away the enormous amount of new debt by people and companies (say the last 6 years) and if you take away the massive amount of foreign money entering this country, the "prosperity" of America suddenly is much more questionable. We buy Toyotas, foreign oil and toys made in china, while the rest of the world invests that money in our stocks, bonds and other assets. Who's getting the better deal? I'd rather own a real productive asset rather than the latest gadget from Hong Kong.
To say that the Reagan administration produced deficits proves nothing, is to deny reality. But then, that was Reagan's MO, wasn't it? I see a theme. Reagan wasn't to blame for the economy, Carter was. Bush isn't to blame, Clinton was...... See the point? This is the insanity of political bias, that whatever positive happens during an administration---the supporters of that administration say the President gets the credit.....and whatever bad happens they assign blame to someone else. You cannot prove that communism fell because of the Reagan administration any more than you can prove the supply side economics was a success. You would have to track all the money saved via tax cuts to every individual and show that it went back into the economy in such a manner as to create new jobs. What if the money saved in taxes went in to buying expensive art? Existing real estate? Savings? Bonds? Donations to charity? Money saved can flow in many different directions that will do little to stimulate the economy. The spending habits of the wealthy are generally unaffected by economic conditions. I am not suggesting tax and spend is the way to go, but neither am I suggesting that cut tax and spend is the solution, it has never been proven to work. Cut spending first, balance the budget, then cut taxes. So many of the macro events during an administration are just spurious events along a time line interpreted with biased political perspective. Have you spoken with any Russians and gotten their opinions on why communism failed? I have, and they certainly don't give Reagan the credit. By the time the Bush administration is finished, and we have massive deficits, a weakened dollar deflating the value of our goods, and other assorted problems....brain deads will still find a way to blame anyone but the current administration.
Oh, okay axeman. So we just should just buy into your theory and totally ignore what actually occurred in reality. There's a bit of reverse science for you. There was no, according to your model, economic growth occurring in the 60s and 70s, when tax rates were MUCH higher? Countries like Sweden, France, Germany, Belgium -- where taxes were and are significantly higher than the current rates in the US -- none of them managed to grow. Obviously we differ in our ideological perspectives, but I fail to understand why it's so important to have the BEST economy, to MAXIMIZE growth. Why not start periodically shooting a few hundred thousand career prisoners then? I'm sure offloading those deadweights will work wonders for your economy. Jokes aside, there are other considerations besides economic growth, you know. I take it guys like you and AAA just put less emphasis on them than people like myself. At the end of the day, we just have differing perspectives on what society should be like. We will probably never convince each other to change (although, in my case, I originally came from a conservative/libertarian philosophical background, so change is possible). Still, you might want to, for you own benefit, at least recgonize that the country you live in (and I don't) is composed of people that do think in a similar fashion to myself, and that that, practically speaking, generally means you are going to end up having to make compromises. So, if you would persuade others to your point of view, you might want to take some time to understand theirs; their concerns, fears, desires etc, rather than simply using "but it's gonna mean more growth!" as the carrot. EDIT I don't mean to say that tax cuts are never a good idea. Certainly there can be economic benefits to cutting taxes without digging a deeper fiscal hole, and without losing some of the benefits that such taxation brought. But now? When the economy's problem is overcapacity? What reason would the investor class (not mom and pops, business investors) have to invest in upgrading capacity when already have too much?
agree with a lot -- all else equal, lower taxes are 'better' - but the problem is the 'all else equal' part. even a zero-tax system is useless without the infrastructure and the legal system to allow a market. if Afghanistan delcared zero-tax tomorrow, who would risk their money to build a factory there? there is no stable currency or system of commerce, no stable power, no transportation system, no effective police to stop someone from taking the factory, and no courts to enforce agreements. all of those still, unfortunately, depend on taxes. not to justify the other extreme, like the thieves in DC scheming to squeeze every possible dime out of every citizen's pocket - but clearly there is some threshold amount necessary.
You are correct, and this is why I support taxation. Just not at these extreme levels. I use my example on to make it clear that there IS an incentive effective for anyone with a brain. peace axeman
This is precisely where your argument is flawed. You are implying that just because you can find eras where there was growth with high taxes, that high taxes do not stifle anything. The fact is, you have no idea if the over all growth would have actually been HIGHER had taxes been lower in those eras. As you said, there are many other factors involved, and this is in fact a very complex puzzle. I believe high taxations does have a significant effect from what i've read of economic history, however, other factors combined CAN over come them. Tax less , spend less. I think that is the key. The 70+ % effective tax rate on me right now is NOT FAIR any way you cut it. We will have to disagree on this. You will never convince me that taking well more than half of my money is FAIR. Period. peace axeman
When all the talk is about cutting taxes, and not cutting waste out of the Federal Government, rest assured that it is the wealthy, lobby groups, special interest, and government contractors who will benefit most.
All the talk is about the taxation side of the fence only because people are arguing against tax cuts I totally agree that you have to cut spending and waste ALSO, as I stated in previous posts. Cutting taxes alone, and then spending more accomplishes nothing. That's what Reagan did. Some will argue that it was worth it because we bankrupted the Soviets, but I'm not going to get into that debate. I agree. Gotta stop the spending/waste. Unfortunately, I believe that is even tougher than getting tax cuts. Spending/waste gettings politicians into office. peace axeman
BOOMS AND BUSTS ARE CAUSED BY CENTRAL PLANNING AND FIAT CURRENCY ! THE TRUE FREE MARKET IS MUCH SMOOTHER THAN OUR CURRENT SYSTEM, AND DOES NOT NEED THE GOVERNMENT TO SAVE IT. DO YOU HAVE COURAGE TO LIVE IN A FREE MARKET ???
All critiques of capitalism, when you REALLY examine them, come down to the issue of INEQUALITY. Everything else is just rhetoric and BS.