The Fiscal Cliff talks

[janicks]

The government intentionally, and systemically, manipulates the inflation rates for several reasons; the chief among them being social security and COLAs.

 

Are you saying the people at BLS are just making numbers up? There are some really smart people there that do good work and are intellectually honest.

 

If you are saying that politicians cherry pick the data to argue for whatever policy they are pushing, then you're probably right.

[Magox]

The more I keep thinking about this Cliff Bill, it actually is a very conservative Bill. It was a bill that permanently lowered taxes for the vast majority of the population. If anything, this bill builds on to George Bush's legacy.

[dayman]

Anyone here that story about Boehner yelling at Reid to go !@#$ off during the whole mess? lol

[Magox]

That's the least he could of said.

[GG]

I made my prediction earlier in this thread--growth will be slowed by the tax hikes in the first half, but will should be 2.5-3% in the second half. In normal conditions (meaning no huge debt over hang), the economy chugs along despite various tax rates and regulations.

 

No moving the goal posts. The question is what would growth be if all Clinton tax rates were imposed? Remember this all started with you laughing at the notion that the tax base needs to increase.

[TakeYouToTasker]

You would agree that the SS surplus is made up of IOUs called t-bonds, yes? Like any government security, it represents the government's promise to pay on those obligations. Where will the funds come from to meet those obligations?

Honest answer?

 

There is a very real press being pushed by many from both sides of the isle, behind closed doors, to push for the retroactive taxation of qualified deferred retirement accounts such as 401(k)s, IRAs, 403(b)s, etc. as well as an increased tax burden on life insurance proceeds. The first actual legislation towards these ends was the changing of Roth conversion guidelines contained in the fiscal cliff deal that just passed.

Edited January 3, 2013 by TakeYouToTasker

[3rdnlng]

Honest answer?

 

There is a very real press being pushed by many from both sides of the isle, behind closed doors, to push for the retroactive taxation of qualified deferred retirement accounts such as 401(k)s, IRAs, 403(b)s, etc. as well as an increased tax burden on life insurance proceeds. The first actual legislation towards these ends was the changing of Roth conversion guidelines contained in the fiscal cliff deal that just passed.

 

You mean it isn't coming out of the Social Security lock box that has funds enough to get us through 2035?

[TPS]

 

 

No moving the goal posts. The question is what would growth be if all Clinton tax rates were imposed? Remember this all started with you laughing at the notion that the tax base needs to increase.

You'll have to remind me when I laughed about that...

The point I've tried to make all along is that the Clinton rates generate more revenue for any given level of GDP (or unemployment) relative to the Bush rates. Nothing more, nothing less. Otherwise known as the full employment or structural deficit.

[GG]

You'll have to remind me when I laughed about that...

The point I've tried to make all along is that the Clinton rates generate more revenue for any given level of GDP (or unemployment) relative to the Bush rates. Nothing more, nothing less. Otherwise known as the full employment or structural deficit.

 

Of course they do, it's simple math in a vacuum that even many idiots here will compute.

 

But, you can't ignore the tax rates' effect on the economy as it's not a linear relationship. People will adapt behavior to manage higher tax rates. That's why the federal tax take has historically ranged in the 18%-19% of GDP, no matter what the marginal rate was. But history seems to be avoiding this administration. I wonder if it's just a coincidence of timing?

[TPS]

 

 

You mean it isn't coming out of the Social Security lock box that has funds enough to get us through 2035?

Right, so if you don't believe it's there, that it's just an IOU, then I trust that you agree with the implications:

1. The increase in SS taxes under Reagan in the 1980s, which was argued for on the basis that there would be SS deficits in the 2000s, was essentially class warfare against the working class. He cut income taxes for the top and raised SS taxes on everyone else.

2. These same arguments being used again today are a complete fraud. That is, the argument that we need to raise taxes and cut benefits today, in order to fix deficits 20+ years from now is the same utter Bullshot.

 

The reality is the government now has to come up with real $s to start paying off the obligations represented by T-bonds in the so-called trust fund. So they will cut SS and Medicare today in the name of funding it past 2035. It's all theater.

[3rdnlng]

Right, so if you don't believe it's there, that it's just an IOU, then I trust that you agree with the implications:

1. The increase in SS taxes under Reagan in the 1980s, which was argued for on the basis that there would be SS deficits in the 2000s, was essentially class warfare against the working class. He cut income taxes for the top and raised SS taxes on everyone else.

2. These same arguments being used again today are a complete fraud. That is, the argument that we need to raise taxes and cut benefits today, in order to fix deficits 20+ years from now is the same utter Bullshot.

 

The reality is the government now has to come up with real $s to start paying off the obligations represented by T-bonds in the so-called trust fund. So they will cut SS and Medicare today in the name of funding it past 2035. It's all theater.

 

Dig in to what the heritage Foundation has to say:

 

 

 

http://blog.heritage.org/2012/12/20/morning-bell-3-simple-solutions-for-fixing-social-security/

 

 

 

While lawmakers from both parties squabble over tax rates, a fiscal crisis is looming on the horizon. Entitlement programs — Social Security and Medicare to be precise — have unfunded obligations of $48 trillion. By comparison, the fiscal cliff carries a price tag of roughly $650 billion. As lawmakers talk about another debt-limit increase, they need to think seriously about America’s long-term obligations.

[GG]

 

2. These same arguments being used again today are a complete fraud. That is, the argument that we need to raise taxes and cut benefits today, in order to fix deficits 20+ years from now is the same utter Bullshot.

 

The reality is the government now has to come up with real $s to start paying off the obligations represented by T-bonds in the so-called trust fund. So they will cut SS and Medicare today in the name of funding it past 2035. It's all theater.

 

It is not a complete fraud, because you cannot ignore the current deficits if they turn into a permanent being. So while there's no danger of funding the entitlements now, running a $1.5tr annual deficit with no economic recovery in sight will make future deficits that much worse. You also can't count on 0% T-rates in perpetuity, so that will worsen the problem. I'm glad that there are people out there sounding the alarm, because you don't want to be in a runaway deficit position and rely on kindness of strangers to buy your treasury issues.

[meazza]

http://www.stuff.co.nz/timaru-herald/business/8139607/Moodys-issues-warning-to-US

[TPS]

 

 

It is not a complete fraud, because you cannot ignore the current deficits if they turn into a permanent being. So while there's no danger of funding the entitlements now, running a $1.5tr annual deficit with no economic recovery in sight will make future deficits that much worse. You also can't count on 0% T-rates in perpetuity, so that will worsen the problem. I'm glad that there are people out there sounding the alarm, because you don't want to be in a runaway deficit position and rely on kindness of strangers to buy your treasury issues.

It is a fraud when working Americans are told that taxes need to be increased today to fix a problem in the future, while at the same time cutting taxes on the rich. It was complete bull ****.

 

The issue IS today's deficit, not tomorrow's. Let's stop pretending that income taxes and payroll taxes are "separate." (of course, that also throws out the 47% pay no taxes BS too!). All taxes go to supporting current expenditures, therefore all government programs are pay-as-you-go programs. You can't pre-fund a program. We need to start by fixing the number one long term issue which is rising healthcare costs.

Does anyone pay attention to what the ratings agencies say? They lost all credibility in 2008.

[TakeYouToTasker]

It is a fraud when working Americans are told that taxes need to be increased today to fix a problem in the future, while at the same time cutting taxes on the rich. It was complete bull ****.

 

The issue IS today's deficit, not tomorrow's. Let's stop pretending that income taxes and payroll taxes are "separate." (of course, that also throws out the 47% pay no taxes BS too!). All taxes go to supporting current expenditures, therefore all government programs are pay-as-you-go programs. You can't pre-fund a program. We need to start by fixing the number one long term issue which is rising healthcare costs.

Does anyone pay attention to what the ratings agencies say? They lost all credibility in 2008.

Myopia, thy name is TPS.

[TPS]

 

Myopia, thy name is TPS.

You most likely misunderstand the point. I understand that making changes today helps resolve today's deficit and tomorrow's deficit. What I'm railing against is the argument that the funds raised today can somehow be "saved" to make future payments.

Simple question: Does a SS trust fund exist that can be used to fund SS for the next 20 years or not?

[3rdnlng]

It is a fraud when working Americans are told that taxes need to be increased today to fix a problem in the future, while at the same time cutting taxes on the rich. It was complete bull ****.

 

The issue IS today's deficit, not tomorrow's. Let's stop pretending that income taxes and payroll taxes are "separate." (of course, that also throws out the 47% pay no taxes BS too!). All taxes go to supporting current expenditures, therefore all government programs are pay-as-you-go programs. You can't pre-fund a program. We need to start by fixing the number one long term issue which is rising healthcare costs.

Does anyone pay attention to what the ratings agencies say? They lost all credibility in 2008.

 

Taxes were cut across the board a dozen years ago. They were just raised on the "wealthy". Government programs are not pay-as-you-go but "borrow"-as-you-go. What programs are being pre-funded? When you mention rising healthcare costs are you referring to Medicare and Medicaid?

[meazza]

 

The issue IS today's deficit, not tomorrow's. Let's stop pretending that income taxes and payroll taxes are "separate." (of course, that also throws out the 47% pay no taxes BS too!). All taxes go to supporting current expenditures, therefore all government programs are pay-as-you-go programs. You can't pre-fund a program. We need to start by fixing the number one long term issue which is rising healthcare costs.

 

How do you address rising health care costs? The technology constantly evolves and what is expensive is the newer treatments. MRI's won't be as expensive in 10-15 years as they are now.

 

Does anyone pay attention to what the ratings agencies say? They lost all credibility in 2008.

 

So did economists.

[TPS]

 

 

How do you address rising health care costs? The technology constantly evolves and what is expensive is the newer treatments. MRI's won't be as expensive in 10-15 years as they are now.

 

 

 

So did economists.

I guess you start by asking why we spend twice as much as any other industrialized country.

Re economists, not ones influenced by Minsky.

[meazza]

I guess you start by asking why we spend twice as much as any other industrialized country.

Re economists, not ones influenced by Minsky.

 

And what is the quality of care in contrast to other industrialized countries? Hint, a friend of mine had a brain tumor. Where do you think her husband sent her to get treatment? Another hint, I'm a Canuck (in passport only).