My wife was reading the news and came across an item and I heard her mumble to herself, “why are they cutting the top tax rate, idiots”. Now, to you and me who are long time Conservatives, we know precisely why: lowering the top marginal rate spurs growth and thus, ultimately, leads to more revenue for the government. But to someone like my wife, who despises politics, it was just a dumb give-away to people who already have quite enough. You have two ways to go with this:
1. Call my wife stupid (I advise against it, but you do you) and try to hammer her into believing that cutting rich people’s taxes is a good idea or…
2. Understand for regular folks who don’t pay close attention that in a political sense, cutting taxes on rich people is not going to be popular. Ever.
Abraham Lincoln advised that a widespread belief, whether well- or ill-founded, cannot lightly be set aside. You can, with patience, set yourself to the task of educating people into your views, but while they have the views, all you can do is work with them to advance as much of your cause as you can. Another example of where Conservatives, who are right, will still run afoul of the people is in the matter of the minimum wage. You and I know that the minimum wage, itself, is one of the dumbest ideas ever created in economics – that all it does is price low-skill, entry-level workers out of the labor market. We can explain this until we are blue in the face and it won’t get us anywhere…average folks just figure that if a person is working, it should be for a wage they can live on. The folks are going to look at it in terms of, “could I live on $8.25 and hour?”, and there answer is going to be a flat “no”, and so they’ll think that paying someone that much per hour just isn’t right.
I bring this up not in order to urge us to abandon Conservatism, but in order that we might understand that there are some brick walls we’re up against and we’re going to have to adjust our playbook to work our way around or over them. That is, we have to play the game on the field that exists, not the field that we might prefer. And it’s not just we who have this problem: our Progressive friends do as well. They have a whole host of ideas which are not remotely popular but they are determined to enact come heck or high water (in this, we have the advantage: more of our policies are actually popular than Progressives policies are). They, too, have to work their way around the widespread beliefs of the people. They do it by lies and disgusting political tricks. As we have a sense of honor, we can’t do it that way…but we still have to lean new ways of doing things.
What our Never Trump, Fredo-Cons don’t get is that we’re not going to have anything Conservative if all we’re doing is quoting the Founders and arguing for lower taxes. First off all, taxes and the Constitution are not the crux of the matter. We’ve seen even Progressives agree to lower tax rates from time to time and we’ve especially seen over the previous eight years that the Constitution is utterly meaningless to them. Additionally, as long as their unconstitutional actions don’t immediately harm the mass of the people, the people will not rise up against them (they did screw up with Obamacare – shoving it through unconstitutionally wasn’t fatal to them, however…what was fatal is that the bloody thing didn’t work, not even half-work like Social Security does). In order for us to have anything – to leave any semblance of America to those who will be alive 100 years from now – we on the right are going to have to get very smart about how we take on issues which matter to the people.
Think about it like this – if the Republican Party were to cut taxes across the board except that on people who make more than $1,000,000.00 per year, the top marginal rate was going to 40%, then we’d win the tax debate in a walk-over. All we would have done is move the top rate four tenths of a percent higher and on income which is 120% higher than now. The top marginal rate today is 39.6% and it kicks in at $400,000.00 per year. Even the highest income earners would get relief because there’s $600,000.00 more in yearly income which would be at a lower rate than now but we on our side would be able to say, “see, we’re making the rich pay their ‘fair share'”.
Let’s raise the minimum wage to $16.00 per hour – with an allowance for companies of less than 100 employees to deduct on taxes, dollar for dollar, each dollar over $8 per hour. It makes us in favor of a “living wage” without putting an undue burden on small to mid-sized companies (larger companies can carry the freight).
Yes, I realize that all of this is based upon a false understanding of pure, free-market economics. But, what are you going to do? Tell a blue collar worker in Michigan that the rich guy has to pay less in taxes than he does, now? Tell people that they don’t need a higher wage?
The bottom line is that we’re in a crisis in this nation. We’ve got schools failing to teach kids to read but filling their minds with Progressive garbage. We’ve got a popular culture which relentlessly and mercilessly attacks basic human decency. We’ve got a Ruling Class which is corrupt to the bone and willing to sell us out to anyone, foreign or domestic. The institution of the family is under attack. Religion is being forced to prove itself worthy of being allowed to exist. Fifty more years of this, and there won’t be an America left to conserve. We’ve simply got to get power and keep it, for a long time. And we can’t obtain and retain power unless we’re offering something to the people which is of immediate, tangible benefit to them. Remember, the people are generally on our side on the matters of faith, family and property – only Progressive lunatics want to destroy faith and family and take away everyone’s property. They don’t dare campaign on that because they know their vote would drop to 20% if they did. We can’t beat something with nothing – we’ve got to bring something to the table.
Trump did – in 2016, he promised tangible things to the people. Yes, tax cuts were included – people do like their taxes cut, they are just less enthused about taxes being cut for people who make more than they do. But he also offered to bring back the jobs that Obama and the Fedo-Cons said weren’t coming back. He promised us a border wall…which is actually supported by a far larger segment of the Latino population than the MSM wants anyone to know. He promised to drain the swamp – and the people, correctly, view our government as hopelessly corrupt. What Trump didn’t promise us was that he was going to ensure that the 4th Amendment was going to be enforced just as the Founders envisioned. He’s enforcing it like that, but that wasn’t part of his sales campaign for the Presidency (and every political campaign is, at bottom, a sales campaign). You see? Promise what the people want, and then in addition to that, do the other things which need to be done, but don’t necessarily have a huge political constituency behind them.
We’ve got Trump in, now. He’s beset by enemies trying to annul the 2016 election. They may succeed: time will tell. But our fight was, is and remains to obtain and retain power for as long as we can. The longer our people are in charge the more likely our total program will be enacted. Give us 20 years of uninterrupted GOP government and we’ll have saved our nation. By the time the Democrats get back in after that, it’ll be too late for them to undo what we’ve done. It took the Progressives 80 long years to get us to where we are…because no one really wanted anything they were selling, so they have to go slow and disguise their real goals. We don’t have to do that – we can say with pride what our goal is: a people free, secure and able to do with their own as they wish. We can turn the clock back a lot faster than the Democrats pushed it forward…and turn it back in such a manner that it is increasingly difficult for them to get rolling again.
The key is power – we must have it. Having it means that we can’t be pie-in-the-sky purists on policy. We have to tailor our desires to what the people want at the moment. Never abandoning the goal and, indeed, never actually compromising it…but by weaving together what is possible with what is best, moving the ball forward, day after day.
Blogs For Victory 
Your first idea isn’t bad—-the increase is minimal, it affects only a few people, but it has a lot of symbolic value. And in a nation which does not think but only feels, this can be important.
Raising the minimum wage is pure insanity. No, bigger corporations CAN’T “carry the freight”. Corporations don’t pay taxes, they merely pass on tax costs to the consumer. Ditto for cost of operation. Seriously, do you think that any “big corporation” is just going to eat a cost of doing business increase? No, they will all just add this cost to the purchase price of what they sell. And the consumer will get hit, not the company. But the domino effect will kick in, till all wages rise, and of course the cost of living will go up right along with them, so in the end the ratio of wages to cost of living will be just what it is now, and unskilled labor will be no better off than they are now. In the meantime, the increased income (even if it does not mean increased buying power) WILL mean increased taxes. That idea is lose lose lose lose lose, with no winners except, in the very short run, whoever votes for it.
I think a very underrated Trump appointment was Betsy DeVos. Changing our educational climate at the lower grade levels on up is an absolutely essential component of saving the country, and her agendas, such as more charter schools, is the first positive step in that direction. Forget the colleges—-they are lost and will be lost till they start getting inundated with high school graduates who won’t buy into their nonsense. That means we have 12 years, K-12, to make a real difference. Taxes are important, jobs are important, deregulation is important, but nothing is more important than turning out citizens who are actually EDUCATED and who can think for themselves.
Your wife is not stupid. She is smarter than you. Cutting taxes for the rich does not spur economic growth. Just look at the history. The economy did better after Clinton raised taxes on the rich, than before taxes were increased. The economy did worse after Bush cut taxes for the rich, than before taxes were cut. Obama increased taxes on the rich in 2013 and the economy did better after taxes on the rich were increased than before they were. Conservatives like to point to Reagan as an example of tax cuts spurring growth, but they didn’t. After Reagan cut taxes, the unemployment rate went up to 10 percent. It was only after the Fed lowered interest rates, that the economy started to grow. While cutting taxes on the rich does not increase economic growth, it does increase deficits and debt. Most of our increase in national debt over the past 35 years is the result of Reagan and Bush’s tax cuts. Without them, our national debt would probably be below $5 trillion. instead it’s approaching $20 trillion.
The minimum wage is good for the economy. When working class people get paid more money, they spend more, which stimulates the economy. If workers do not earn a decent wage, they don’t have money to spend. Without buyers, there can’t be sellers. Henry Ford understood this 100 years ago. Conservatives still don’t understand this today. In addition, paying workers higher wages and improving working conditions leads to better productivity and lower employee turnover. After Henry Ford doubled his workers’ wages, productivity went way up.
Progressives don’t want to destroy faith and family and take away everyone’s property. You’re being dishonest when you say that. Progressives want American workers have good wages and good working conditions. Progressives want to make sure poor people have enough food to eat and decent housing. Progressives want all Americans to have access to good healthcare. Progressives want clean air and water, and safe food to eat.
You were given power. After the 2002 elections, you had control of all three branches of government. After four years of conservative control of the government, Americans did not like what they saw, and voted conservatives out of power. Progressives took control of the government in 1932 and their policies were so popular that Americans continued to elect Progressives for close to 50 years. It’s true there were two Republican presidents during that time period, but their domestic policies weren’t much different than Democratic policies at the time. In 2016, Trump managed to win the presidency with a minority of votes. He is probably the most conservative president we’ve had in modern times. He is also the most unpopular president we’ve ever had. He has the lowest approval ratings of any first year president.
This is the difference between you and me. You base your views entirely on your ideology. My views are based on what has been shown to work the best. Your views are based entirely on your ideological and religious beliefs. If tax cuts for the rich led to budget surpluses, low unemployment and strong economic growth, and if tax increases on the rich led to huge budget deficits, high unemployment, and slow economic growth, I would support tax cuts for the rich just as much as you do, but they don’t. On the other hand, you will always oppose tax increases for the rich or a higher minimum wage, regardless of how successful these policies are.
Cutting taxes for the rich does not spur economic growth. Just look at the history. The economy did better after Clinton raised taxes on the rich, than before taxes were increased. The economy did worse after Bush cut taxes for the rich, than before taxes were cut. Obama increased taxes on the rich in 2013 and the economy did better after taxes on the rich were increased than before they were.
This is a view that completely ignores context. The economy is like an aircraft carrier—-it takes a lot of ocean to turn an aircraft carrier, and it takes a lot of time to correct an economy. To claim that these economic upturns were due to raised taxes is simply a very shortsighted and partisan point of view.
Clinton’s good years had nothing to do with raising taxes, and everything to do with luck and accidental good timing, as the tech boom created new jobs in every arena. The tech boom was supported by the additional money available to companies thanks to Reagan tax cuts. The economy may have done better AFTER Clinton raised taxes, but that is a far cry from believing the economy did better BECAUSE Clinton raised taxes.
Most of our increase in national debt over the past 35 years is the result of Reagan and Bush’s tax cuts. Without them, our national debt would probably be below $5 trillion. instead it’s approaching $20 trillion.
This is just ridiculous. You are ignoring the massive increases in spending. More money going out equals more debt if more money is not coming in, but you are ignoring the source of that money that has to come in, and it has to come from a strong economy. Clinton, and especially Obama, escalated outgo so dramatically that no tax hike could have kept up with hit.
The minimum wage is good for the economy. When working class people get paid more money, they spend more, which stimulates the economy. If workers do not earn a decent wage, they don’t have money to spend.
This is akin to “moving tree branches make the wind blow”. When the companies that employ working class people have to deal with rising costs of doing business they pass these increases on to the buyers, so their products cost more, eating up the increases in wages that prompted the whole process.
The key is not to pay people more than their work is worth. The key is to train people so their work is worth more.
Progressives want American workers have good wages and good working conditions. Progressives want to make sure poor people have enough food to eat and decent housing. Progressives want all Americans to have access to good healthcare. Progressives want clean air and water, and safe food to eat.
And gee golly, so do Conservatives! The difference is, Conservatives want those workers to EARN the money it costs to accomplish all these wonderful idealistic goals, and Progressives want them to just hold out their hands so Uncle Sugar can fill them up with goodies paid for by Other Peoples’ Money.
In 2016, Trump managed to win the presidency with a minority of votes.
This just chaps Dem asses. But when we look at the breakdown of the votes, the difference between the minority you complain about and the majority of Hillary votes you people point to with such pride comes from two cities in the United States—-Los Angeles and New York. So what you are really saying is that these two enclaves of Progressive ideology should be able to dictate the governance of the entire country. Enclaves which, by the way, are suffering greatly from the effects of Progressive policies.
Clinton’s tax increase was a factor in the economy improving during the 1990s. Clinton’s tax increase resulted in lower interest rates, which were a big benefit to businesses and consumers, and greatly helped economic growth.
There were big increases in deficits and debt after Reagan and Bush’s tax cuts because of reduced government revenue, not increases in government spending. We didn’t see these big increases in deficits and debt in years in which we did not have big tax cuts. As a percentage of gdp, government spending has been relatively stable over the past 40 years. In 2015, government spending was 20.6 percent of gdp. In 1975, government spending was 20.6 percent of gdp.
Businesses do not base the price of their products on labor costs. Prices are based on supply and demand. Businesses are always going to charge the highest price for their products that people are willing to pay, regardless of what their labor costs are. American corporations are sitting on more than $1 trillion in cash. They could easily afford to pay workers a decent minimum wage.
Based on the policies they support, conservatives do not want working class people to have decent wages. Without minimum wage laws and other labor laws, there is nothing to prevent businesses from paying workers the bare minimum, regardless of how hard laborers work or how well the business does. This would especially be true when there is high unemployment. Apple makes $30 – $40 billion in profit each year, but the workers who assemble their products in China barely make enough eat and pay for their housing.
The majority of Clinton’s votes did not come from NYC and LA. There are a few million voters in NYC and LA. Clinton got over 65 million votes. New York City is one of the wealthiest cities in the US. The people there don’t seem to be suffering very much. People are willing to pay $1 million for a one bedroom condo just to live there. The ones who are suffering are the ones living in the most conservative states, like Alabama and Mississippi. It’s these state’s conservative policies that keep them so poor,
Clinton’s tax increase resulted in lower interest rates,…
What is the federal reserves function for that dynamic Brian? For example, what level of taxation causes a 1/4 point drop? That would be very good to know and thanks in advance.
In 2015, government spending was 20.6 percent of gdp. In 1975, government spending was 20.6 percent of gdp.
34% in 2015
https://www.usgovernmentspending.com/total_spending_chart
They could easily afford to pay workers a decent minimum wage.
Who determines what “decent” is?
You said that supply and demand determines the cost of a product. Why shouldn’t supply and demand then determine the cost of labor?
Based on the policies they support, conservatives do not want working class people to have decent wages. AND It’s these state’s conservative policies that keep them so poor,
Which specific policies are you speaking of?
Brian, you speak in very vague generalized statements and virtue signaling is littered throughout your posts. I am guessing you are a college graduate, and think of yourself as very informed and woke? Am I wrong?
Businesses do not base the price of their products on labor costs. Prices are based on supply and demand. Businesses are always going to charge the highest price for their products that people are willing to pay, regardless of what their labor costs are
Oh, I see. It took Mr. Cut-and-Paste to explain that the cost of doing business is not related to the cost of the finished product. So good to know. I used to be convinced when I heard that, for example, the price of something went up because the cost of one or more of its components had gone up. I guess Bri has cleared that up for us all.
Based on the policies they support, conservatives do not want working class people to have decent wages.
I guess Bri is talking about policies such as incentivizing productivity by implementing tax policies that let people keep more of what they earn. He does go on to spout Marxist-sounding anti-business rhetoric, but it doesn’t make any more sense now than it ever has. It is basically a feeble effort to make blatant bias sound somehow reasonable. But that never works, never has, and never will, except to those who are inclined to like the Big Brother, Central Authority fantasy spun by people like Bri….
….yet wait a minute. He also seems to be dissing one of, if not THE, main Central Authority figures in the world. Gee, wouldn’t you think that if a massive and extremely powerful Central Authority would solve the problems of unequal income, China wouldn’t have millions of people making “…barely …… enough (to) eat and pay for their housing…”?
So I wonder what his model is. More to the point, if he has one. So far it seems that he is motivated solely by a sullen and surly resentment of capitalism and corporations, which he tries to dress up by feigning such deep concern for the unskilled laborers among us.
Perhaps he thinks that a hybrid system, one which has the same disdain for free markets and economic freedoms as the inevitably-failed historical examples have had, would for some magical reason finally work in the United States. Who can tell? These people never really make sense, once you get beyond their incoherent resentments and parroting of Leftist cant.
The majority of Clinton’s votes did not come from NYC and LA. There are a few million voters in NYC and LA. Clinton got over 65 million votes.
That is correct. Hooray for Bri and his ability to completely misread a comment and substitute something irrelevant to snarl at. As usual, there is no way to know, when something is misstated so dramatically to set up a straw man argument if it is because of lack of reading comprehension or just an effort to mislead. In any case, if Bri thinks this was a win, it was a hollow triumph.
Hillary Clinton got, according to Politico, 64,223,958 votes, to Donald Trump’s 62,206,395. My handy dandy little calculator says that shows a margin of 2,017,563 votes. (Before you have a cow because you can find some slightly different figures, I didn’t spend a whole lot of time making sure that my references were the absolute latest possible when it came to the FINAL vote tally. Suffice it say they are adequate to make my point, but please do double check my figures, as you need the tutorial.)
We are talking about the margin here, not the total vote count. The margin is the difference between who got the most votes. We are talking about what areas pushed Hillary into that 2+ million votes that has you Libs still giddy with the tattered remains of all you can find to chortle about, regarding the election. With me so far.?
Good. Typing slowly now so you can keep up.
In Los Angeles alone, the margin between Clinton and Trump was 1,694,621. See where I am going here? OK—now let’s head east. In just four counties in New York—-Kings, Queens, Bronx and New York Counties—we have a total margin of 1,536,797.
Therefore, the metropolitan areas of Los Angeles and New York City accounted, by themselves, for something like 3,554,360 more votes for Clinton than for Trump. The NYT said at one point that Clinton’s margin of victory, counting popular votes, was more like 2.2 million, Even with that expanded figure it is clear that without huge leftward swing in the two metropolitan areas she would not have had the popular vote.
But it gets more interesting, if by “interesting” you mean “not the Hillary blowout you want so desperately to claim”. Her two-state 5.4 million margin is significant in yet another way, as CA and NY stop counting absentee ballots when their total uncounted number is less than the margin of the winning candidate.. (Calm down. This comment refers to the two STATE margin, while I have only been focusing on two metropolitan areas.) As absentee ballots historically run about 2-1 in favor of the Republican nominee, we can see that there would have been some changes in the final tally—if there had been a final tally.
Wait—I’m not finished. Out of 3,143 counties, Clinton carried about 300.
The NYT states that “Trump’s geographic area covers 85 per cent of the U.S. versus Hillary’s 15 percent.
Still want to argue that the final vote count showed a national preference for Hillary Clinton?
Regarding NYC, you state “…people there don’t seem to be suffering very much. “ You seem to think that this odd statement is proved by the fact that, according to you, “(P)eople are willing to pay $1 million for a one bedroom condo just to live there.”
Seriously. You really think that in a city so elitist that it takes a million dollars to buy a one bedroom condo people are not “suffering very much”? How about the people who make the city habitable? You know, the little people who do the cleaning, pick up the garbage, take care of the wealthy children, drive the taxis and buses, work in the subway system, etc? Are you truly claiming that they buy million dollar condos? It seems to me that the very definition of a suffering population would be to live in a city with such wildly inflated costs of basic human necessities, such as housing.
Since NYC is a bastion of Left-wing ideology and policies, it should be taking really super care of the needy, shouldn’t it? So where is the affordable housing? Why are there so many homeless? What about the Leftist economic model is not meeting the needs of the people?
Boy, talk about out of touch!
Obama increased taxes on the rich in 2013 and the economy did better after taxes on the rich were increased than before they were.
Actually, Obama raised taxes of some sort or another numerous times between 2009 and 2014. Given that economic growth during Obama’s entire 8 years was well below historical norms, it’s difficult to see any positive correlation with economic growth. So your assertion is at best wrong, and at worst, just a lie.
As for your assertions about the Reagan years, I don’t have the motivation or the time to put together a detailed analysis of why you’re wrong, but thankfully, Forbes did a pretty good job a while back.
Trump won the presidency by getting a MAJORITY of votes in the states he needed to get them to win the election. That’s how the game is played.
The vast majority of American’s did NOT vote for Clinton when you count those who voted for Trump or didn’t vote (or voted for a third party). Clearly, a majority of Americans rejected Hillary. (Even a majority of voters, if you count third parties.)
Many Trump supporters in deep blue states didn’t bother to vote because they knew it would make no difference in the outcome (and those states happen to have the biggest populations). Trump won almost all the swing states where voters knew their votes would make a difference. It’s a stupid argument to say Hillary got lots of extra votes in states where Trump didn’t bother to run ads or campaign.
Free advice here to Democrats, you won’t win the presidency again until you admit Hillary was a horrible candidate. You didn’t win after Reagan until Bill Clinton turned on Jimmy Carter. Likewise, you’ll need to apologize for Hillary if you want to win a national election.
Progressives want American workers have good wages and good working conditions. Progressives want to make sure poor people have enough food to eat and decent housing. Progressives want all Americans to have access to good healthcare. Progressives want clean air and water, and safe food to eat.
And here we have the heart of American Progressivism. That is, merely being FOR something is all it takes to occupy the Higher Moral Ground. The key word here is “want”.
I also note the Progressive assumption that if anyone does not agree with the Progressive solution to achieving this starry-eyed wish list, that person does NOT want people to have food to eat, medical care, decent housing, etc.
There was a time, which now seems long long ago, when people of different political persuasions understood that the basic goals were the same, and that the political differences lay in how best to achieve them. The Left had to change that dynamic, because for one thing it led people to think, and thinking is death to Progressivism. So they started the tectonic shift from debate on how best to achieve the same goals to a binary, zero sum belief system——that is, if you don’t support taking OPM to achieve a goal, that means you are against the goal itself.
This has allowed the Left to emotionally manipulate millions, whose Liberal “educations” have already failed to teach them how to think for themselves, to posture as more moral, more kind, more compassionate, more loving, just better people in general, because only THEY want good things for people.
This “education” has also omitted facts about the history of this country such as that economic freedom is what launched this raw new nation, cobbled together from wildly disparate and often feuding demographics, into an economic powerhouse that dramatically raised the standard of living for everyone who participated in it, that dramatically increased the life expectancy and quality of health care, that thrust even the “poor” into a world in which they had houses and cars and most of all, hope. This “education” has not taught its victims that when people had equality under the law and freedom to not only develop their skills and talents but to profit from doing so, they created a beacon of freedom and prosperity that drew like-minded people from all over the world, people who wanted to be part of it.
Progressives (a term oddly applied to a political system that is wholly REgressive) don’t want a nation in which people who apply themselves and take advantage of the many freedoms guaranteed by our Constitution can hold out helping hands to those who have not been able to, and even to some who have chosen not to, do the same. No, Progressivism is inherently anti-freedom, as it strives to categorize people, limit freedoms, penalize success, and impose its own standards and values, including taking what other people have earned and dividing it the way its leaders decide it should be divided.
(Historical note: In the past, when OPM has been divided by Progressive elites, a lot of it has been funneled into the bank accounts of those elites. Don’t just take my word for it—check it out.)
You’ve got that a bit backwards – the Clinton economy was in the doldrums until the GOP Congress came along in ’95 and fixed his mistakes (and the mistakes of the elder Bush, as well). Cutting taxes always spurs growth because it retains money in the productive economy. The government cannot spur economic growth because each cent it spends – taxed or borrowed -is merely a cent taken out of the productive economy. There are no extra dollars out there – and government cannot create wealth.
That’s just plain stupid. The government literally spends every dime it has (and more). It doesn’t disappear from the economy any more than it does when I go spend $5 at McDonald’s.
You literally don’t know how an economy works.
Do you know how you CAN get it to get sucked out of the economy, though? You give it to a rich person or a large corporation.
Corporations are taxed on profits. Lowering the corporate tax rate actually increases the effective cost of hiring an employee. If I have a 35% corporate tax and I hire a $100k/yr employee, the marginal cost for me is $65,000, because I would have lost $35,000 to taxes anyway if I had not hired an employee. If it is say 21% instead, the marginal cost is $79k, because not hiring the employee means I get to keep more money.
You’ll see this effect in action when corporations take the tax cut they are about to get and use it to pay off debt and buy back stock rather than hiring anybody. I mean, they already have corporate profits: https://tradingeconomics.com/united-states/corporate-profits why would piling more money up for them to swim around in possibly matter even if you ignore the perverse incentive?
Meanwhile, if you give a kickback to a rich person, they just go stick it in the bank or in an investment. Some of those investments might be in stocks that move some money around, but by and large everybody saving and nobody spending is how an economy crashes. Oh, and those stock buyback from before go right into their pockets to get saved as well.
On the other hand, if you give money to a poor person living paycheck to paycheck, they will spend it all on things like groceries and rent, and save virtually none of it. The money gets all injected right back into the economy.
The government literally spends every dime it has (and more). It doesn’t disappear from the economy any more than it does when I go spend $5 at McDonald’s.
Like literally they spend every dime? Narley. So the money spent on foreign aid doesn’t disappear from our economy? How about the money sent to prop up the the UN? Or Haiti? Or how about the money Obama agreed to give Iran? How does that help our economy? And I liked your “(and more)” reference …… where does that money come from? I have a question for you – is unemployment an economic stimulator?
Meanwhile, if you give a kickback to a rich person, they just go stick it in the bank or in an investment.
Just curious travesty, where do you think start up capital comes from? Where do you think mortgage funds come from? Where do you think venture capital funding comes from?
The reason why some people have money and you don’t, is because they understand the cost of money. I don;t know of any wealthy person who just “stick their money in the bank”. Have you seen the return rates?
And this is why no one trusts people like you to run our economy.
That’s just plain stupid. The government literally spends every dime it has (and more).
I don’t know about “spend”, but they certainly get rid of a lot of money, and more often than not, in an incredibly inefficient way, largely because government, particularly at the national level, has no incentive to be efficient. But if you think the government can manage and spend YOUR money better than you can, by all means send all your money to the swamp. And the “(and more)” part? It’s actually nice to see a Liberal admit that the government doesn’t even try to live within its means. That’s the part that Conservatives think is “just plain stupid.”
Is there anything funnier than watching a Progressive “explain” economics? Well, maybe watching Roseanne give singing lessons, or Rosie lecturing on civility.
Tryvasty lectures: Do you know how you CAN get it to get sucked out of the economy, though? You give it to a rich person or a large corporation.
I’m not sure how you can just “give” money to a large corporation—unless you are the government, that is. The government under Obama did manage to “give” millions and millions, even billions, of our money to large corporations, such as Solyndra. As we never had any idea what happened to it—-only knowing what it did NOT accomplish—–I supposed one could posit that it just got “sucked out of the economy”. It sure got “sucked out” of the Treasury. Though I am sure the beneficiaries of that government largesse did put a lot of that money back into the economy, just not in the way it was intended.
Let’s look at this piece of economic brilliance: “…if you give a kickback to a rich person, they just go stick it in the bank or in an investment. Some of those investments might be in stocks that move some money around, but by and large everybody saving and nobody spending is how an economy crashes.
Start, of course, with the surly emotion-ridden use of the word “kickback”. As in “letting him keep more of his own money is just a kickback”. That is how the Left thinks—it’s always THEIR money, always the GOVERNMENT’S money, and sometimes they LET us keep a little of it. Which some refer to a “kickback”.
Then there is the economic illiteracy in the concept that if you “give” more money to a “rich person” (which in the real world means not taking as much from someone who has more than you do, the Leftist definition of “rich”) he will not “spend” it but will do something totally unproductive with it—-like put it in the bank, or worse yet, invest it.
But let’s walk down that path with Try for a moment, a path already blazed by Cluster, and say that Mr. Bigbucks has put that money he didn’t have to turn over to Uncle Sam in the bank,instead. Let’s assume that he made all those big bucks by wanting his money to grow at about one percent, and prefers to put his money in the bank. Then what? In Leftyland, this is a lot like putting it in a coffee can and burying it in the back yard—-it just becomes inert. But in the real world, that money in that bank provides the means for the bank to make business and home loans. Yeah, the bank puts the money to work, out in the economy where it is not inert but active—building businesses, buying homes and furniture and cars, pumping up the economy while at the same time allowing people who are NOT “rich” have the use of Mr. Bigbucks’ money. Which is, we must not forget, HIS money. Not the government’s money, which the government reluctantly “kicked back” to him.
A lot of this money ends up providing the basis for creating more jobs and hiring more people.
Or he might invest it—-another emotionally laden word for the Left, as it reeks of capitalism and is therefore suspect at its core. But, of course, when money is invested it then becomes active in the investment. It provides funding for R&D, for expansion and growth, for hiring more people to expand the company.
Only a Lib who loves the idea of people being dependent on the government could find saving to be a bad thing. Of course, this is all we can expect from someone with the grasp of economics shown by Tryvasty.
I can’t even begin to address the bizarre scenario Try has presented about the cost and/or benefit of hiring someone. The one thing that glares through the silliness is the fact that he is totally, 100%, brazenly ignorant of how any economy works. I suppose this is a natural byproduct of a mentality that thinks everything comes from the government. It was just plain downright goofy.
But…..do you want to know how to suck money out of the economy? Allow millions of illegal aliens into the country who then send literally trillions of dollars (most of it untaxed) back to their native countries every year. Trillions. And, of course, there is the list of sucking drains of money posted by Cluster.
A couple of other Try comments illustrate his attitude toward money and corporations. One is his objection to corporations paying off debts. To a Lib, debt is just fine, just numbers on a page. Or, in the case of the government, many pages. They are totally unconcerned about the national debt because it is meaningless to them, just a bunch of numbers. So what?
The other is “..money up for them to swim around in..” Clearly Try’s image of people with money was formed by watching cartoons and seeing Scrooge McDuck running his fingers through piles of gold coins while cackling in glee. “Swimming around in..?” It would be funny if it were not such a scary peek into what passes for understanding what business is and does.
On the other hand, if you give (OTHER PEOPLES’) money to a poor person living paycheck to paycheck, they (SIC) will spend it all on things like groceries and rent, and save virtually none of it, (CREATING NO EMERGENCY FUND OR SETTING ASIDE MONEY FOR LARGE IMPORTANT PURCHASES SUCH AS A HOUSE OR A CAR.) The money gets all injected right back into the economy (AND WHEN THERE IS AN ILLNESS OR INJURY OR LAYOFF THE PERSON WILL BE DEPENDENT ON THE GOVERNMENT.)
There—fixed.
Some info for Try and Bri—-anyone think either of them will actually read it?
http://dailysignal.com/2017/12/14/5-myths-tax-reform-theyre-wrong
“So the money spent on foreign aid doesn’t disappear from our economy?”
Sure. Want to look up what percentage of our budget is spent on foreign aid and how that relates, as a percentage, to medicare plus medicaid plus social security plus the military?
Want to take a guess at whether a greater percentage of your tax money leaves the country than a percentage of the $5 I spend at McDonald’s, a multi-national corporation?
“I don’t know about “spend”, but they certainly get rid of a lot of money, and more often than not, in an incredibly inefficient way, largely because government, particularly at the national level, has no incentive to be efficient.”
The efficiency of their spending literally doesn’t matter with regard to the idea that they take money out of the economy. If I hire 3 workers to do one person’s job, I still pay those three workers, and they still buy goods. There are plenty of reasons to be unhappy with government efficiency, but they are all completely irrelevant to the point.
“And the “(and more)” part? It’s actually nice to see a Liberal admit that the government doesn’t even try to live within its means.”
Yeah, cause the Republicans do such a beautiful job balancing the budget. I mean, just today they were working out how to add a trillion dollars to the deficit.
“On the other hand, if you give (OTHER PEOPLES’) money to a poor person living paycheck to paycheck, they (SIC) will spend it all on things like groceries and rent, and save virtually none of it, (CREATING NO EMERGENCY FUND OR SETTING ASIDE MONEY FOR LARGE IMPORTANT PURCHASES SUCH AS A HOUSE OR A CAR.) The money gets all injected right back into the economy (AND WHEN THERE IS AN ILLNESS OR INJURY OR LAYOFF THE PERSON WILL BE DEPENDENT ON THE GOVERNMENT.)
There—fixed.”
I’m pretty sure you don’t even understand what conversation we’re having, because your “fix” doesn’t even relate.
Also, you should avoid doing the (sic) thing. I know that “they” is plural and the sentence should have correctly read “his or her”, but that gets wordy, and it turns out I don’t care. Meanwhile, you can’t even use a conjunction correctly. “CREATING NO EMERGENCY FUND OR SETTING ASIDE MONEY FOR LARGE IMPORTANT PURCHASES SUCH AS A HOUSE OR A CAR.” I mean, really? Do you think that’s actually correctly constructed?
Oh, and I’ll start worrying about what The Daily Signal has to say if you agree to spend your time reading Mother Jones. I’d say they are about equally reliable.
I notice that Tryvasty is literally just nitpicking at literally everything anyone says, literally cherry-picking what to address while literally ignoring the real points made. He like, literally answers questions that were never asked, and literally skips from one idea to another.
He appears to literally think that the purpose of a corporation is to actually literally just support people, not to actually produce some kind of product to sell at a profit, so he literally misses the whole point when he explains that it is OK to pay three people to do “one person’s job” because then those three people will actually literally go out and spend that money. Evidently the fact that the corporation has just tripled its labor cost to produce something and will then have to add to the purchase price to make up for that unnecessary production expense literally has no actual significance to him, nor does the fact that the price has risen without a concurrent rise in the actual literal value of the product.
A lot of his post literally makes no sense at all: “Want to take a guess at whether a greater percentage of your tax money leaves the country than a percentage of the $5 I spend at McDonald’s, a multi-national corporation?” Maybe in Libland a multinational company makes money in the United States, pays taxes on that money in the United States, and then sends that money overseas, thereby literally becoming little different than foreign aid. Or ???? Who can possibly tell? Literally?
“There are plenty of reasons to be unhappy with government efficiency, but they are all completely irrelevant to the point.”
I think he has actually, literally, lost track of the point, which I believe was something about how big corporations should not get tax cuts because then they could make more money by not hiring people to make more product to sell. Actually, losing track of that point is literally a wise move, as it made no sense at all, much like his grasp of how commerce works.
He is, literally, like tap dancing, bouncing around from grammar analysis (incorrect, by the way, actually) to playing “yeah, well, but….” when he tries to shift from Dem overspending to “Yeah, cause the Republicans do such a beautiful job balancing the budget…” That is like, literally such a rookie move, and soooo predictable. It is actually a way of saying “I literally have no response to what you said but I feel compelled to say something.”
Weren’t his posts literally a little more coherent back in the day? It’s like he is actually just calling it in, without any real conviction that he is, literally or actually, expected to make any sense.
Travesty dodged every question and made some really bizarre comparisons – and no one is surprised. He turned the “money being sucked out of the economy” issue into a percentage of gdp comparison to entitlements issue – and I have no idea how he got there.
Regardless travesty, you do have a cartoonish view of money and the economy. And I can tell you this – productivity and efficiency do matter whether it be in the public or private sector, and labor is a commodity so if you as a government hired 3 workers to do 1 persons job, you are actually hurting the economy by using productive dollars to subsidize non productive activity and this is the very reason why most large public ventures have massive cost over runs and time delays. These actions HURT the economy travesty. Here’s the bottom line, a service or good will either be delivered via the private sector or public sector, and each and every time, the private sector delivers it much more efficiently and cost effective. There is no comparison. You just don’t like the fact that some people will get rich, but that’s just your petty jealousy.
Cluster, I think the argument that paying three people to do the work of one would stimulate the economy pretty much sums up both the understanding of economics on the Left and its support for a government that too often does that very thing.
In a system where government employees can’t be fired (Civil Service) to get a job done often requires hiring more than one person to do what, in the private sector, would be done by one employee. The Left loves this system, and screams and screeches and has hissy fits every time conservatives want to streamline agencies and cut dead wood. The Left can’t stand the word “productive” no matter how we use it.
“I notice that Tryvasty is literally just nitpicking at literally everything anyone says, literally cherry-picking what to address while literally ignoring the real points made.”
I’m so sorry that you can’t just jump into whatever conversation you want and say unrelated thing you want and have me talk about that instead of continuing the original conversation. I am woefully aware that your MO is to turn every conversation into a brag session about how you have principles and I don’t, though, so I’m going to continue not taking the bait.
Also, anybody notice how whenever I ignore your attempts to change the subject, you start ridiculously grandstanding and referring to me in the third person?
“I think he has actually, literally, lost track of the point, which I believe was something about how big corporations should not get tax cuts because then they could make more money by not hiring people to make more product to sell.”
A point that none of you have even attempted to refute, by the way. Snarkily dismissing it doesn’t count.
“He is, literally, like tap dancing, bouncing around from grammar analysis (incorrect, by the way, actually)”
You’re the one who started with the grammar analysis when you decided to get cutesy with your editorial “(sic)”. Want me to make you a sentence diagram, by the way? Your negation only applied to the first of the two clauses joined by your conjunction. The way you constructed it, “SETTING ASIDE MONEY FOR LARGE IMPORTANT PURCHASES SUCH AS A HOUSE OR A CAR” with no negation is the alternative to “CREATING NO EMERGENCY FUND”. You’re just so bad at grammar that you can’t figure out what you’ve done wrong even after somebody has pointed it out to you.
“It is actually a way of saying ‘I literally have no response to what you said but I feel compelled to say something.'”
No, it’s a way of succinctly pointing out that Republicans stopped being the party of fiscal responsibility somewhere around Reagan’s starve the beast nonsense. Your votes have all hurt the debt via tax cuts nobody has ever paid for more than mine ever has. It’s like hearing somebody complain about my being a vegetarian and not a vegan when the only thing they’ve eaten for the past 30 years is steak.
“Travesty dodged every question and made some really bizarre comparisons – and no one is surprised.”
If you’re going to accuse me of dodging a question, could you at least be specific?
“I can tell you this – productivity and efficiency do matter whether it be in the public or private sector”
I agree! But what if I told you that efficiency isn’t the only thing, or even the primary thing, that matters to the health of an economy?
It’s the right season, so let’s talk about the inefficiencies of Christmas. To do that, first we’ll have to talk about wealth. Specifically, as I look around the house, one of the primary measures of how wealthy I am is the stuff around me (or in the general sense, my standard of living). The computer I’m typing on is pretty nice. But what wealth does it represent?
It turns out that people just have intrinsic values on things, and you can measure it via supply and demand. In a perfectly liquid system, my computer is worth to me whatever you’d have to offer to pay for it for me to sell it to you rather than keeping it. And, on the flip side, anything I’d attach more personal value to than its price, I am likely to buy.
So then what happens when somebody buys me a Christmas gift? A whole lot of the time, it turns out to be something I wouldn’t have bought for myself at the proposed price point. So if you buy me a $50 item, and I would have only bought it if it cost $30 or less, you’ve introduced a huge inefficiency to the system. You have, in effect, caused $20 of wealth to evaporate. In a perfectly liquid system, I’d immediately sell it for $50 and then buy $50 of stuff I actually want. You might have that one relative that uses the gift receipt for every one of your gifts, but it turns out that’s mostly not what happens. Grandma wants to see you wearing that ugly sweater that she bought you.
So if you want to optimize for economic efficiency, really you should be lobbying for people to quit giving each other Christmas gifts. Only please don’t, because there’s a pretty good chance that would crash the economy. But how could making the economy more efficient crash it???
It turns out that the primary factor in the short term health of economy is how much money is moving through it, and Christmas provides a whole lot of that at the expense of efficiency. Efficiency and productivity are absolutely important, especially if you want to keep the average standard of living increasing over time, but all the hand wringing over the government taking money “out” of the economy is a red herring. Taxed money is liquid money, because the government doesn’t squirrel it away. A liquid economy is a healthy economy.
The reason you want your government to be efficient is it would improve your standard of living, either because you’d get for your money or they could afford to tax you less. It’s an incredibly great reason. Let’s do it. Let’s just not throw in this nonsense about it taking money out of the “productive” economy, whatever that means.
“Cluster, I think the argument that paying three people to do the work of one would stimulate the economy pretty much sums up both the understanding of economics on the Left and its support for a government that too often does that very thing.”
Unfortunately for you, I did not make that argument. Have any other strawmen you want to fish out for me?
Oh, dear, it appears that you, Tryvasty, heretofore addressed in the second person and not the third as this seems to be quite important to you, have become rather irate at my post.
What makes your complaining so funny is that, at heart, I am commenting on typical Leftist themes and tactics, and your responses serve only to make my point for me.
One example of a Leftist tactic is to take something out of context and then try to build a straw man argument about the selected fragment. Here is a great example. You complained about my grammar. You say, in your second rant about it, “The way you constructed it, “SETTING ASIDE MONEY FOR LARGE IMPORTANT PURCHASES SUCH AS A HOUSE OR A CAR” with no negation is the alternative to “CREATING NO EMERGENCY FUND”. Yet the original statement said “,,, if you give (OTHER PEOPLES’) money to a poor person living paycheck to paycheck, they (SIC) will spend it all on things like groceries and rent, and save virtually none of it, (CREATING NO EMERGENCY FUND OR SETTING ASIDE MONEY FOR LARGE IMPORTANT PURCHASES SUCH AS A HOUSE OR A CAR.)
I completed your statements, filling in the logical endings to your comments. Therefore, it is logical to, if one starts with the statement “…if you give money to a poor person living paycheck to paycheck, they will spend it all on things like groceries and rent, and save virtually none of it,..” it is logical to conclude that this will result in creating no emergency fund, etc. I’ll agree that it might have been marginally more elegant to use a different tense, and say “…therefore not creating an emergency fund….” etc. but this is not a grammatical choice, just an editing preference. Not creating a fund is really the same thing as creating no fund. I know you were grasping for a way to sneer at me but really, Tryvasty, this is pretty silly. Even for you.
Let’s see what else got your panties in a twist. Oh, yes, you seem to think it is significant, and may even concede a point, that I did not even “attempt” to “refute” your bizarre conclusion that choosing to not hire more people to produce more product to sell would be a wiser business choice, settling for paying lower taxes on existing profits, than hiring more people to create a larger tax base of profits. OK—I will grant your point, if your point is that businesses do better if they do not grow. While I don’t agree, on many many levels, I can’t argue with your perception of the “best” way for other people to do things, because that would be a waste of time. If you have a personal belief that a business, once it reaches a certain level of production and sales, should just remain at that level and settle for a slightly higher rate of return on what it is already doing, I can’t argue with that. You are talking about how you think someone else should run his business, while I am talking about how a successful business is much more likely to be run, and it is futile to try to argue about preferences.
Your concept of how business should be run also included the concept that it is a better business practice to pay three people to do the work of one, because that puts three paychecks out there buying goods instead of just one.
You say that people place an intrinsic value on things, but at the same time appear to be arguing (when you argue that tripling the labor cost of a product is a good economic decision) that there is no intrinsic value to what is being produced that cannot support the higher labor cost of production. You agree that people will pay what they think a product is worth, but at the same time seem to think people will pay more than they think a product is worth if its production means an additional two, unearned, paychecks in the economy–paychecks given to someone else. Or are you arguing that the intrinsic value of something will rise according to the cost of its production?
What about the eventual outcome of a company paying three times what it should be paying, in labor costs, to produce its product? All that would be needed would be a company or two which did not engage in this practice, producing a product equal in value for far less overhead and pricing it accordingly, to put the first company out of business—-and cutting off all three of those paychecks.
This is the free market system. The only way to stop this kind of competition is to control production of all products, and impose “equality” on all production, such as the cost of labor. This is what the Left has been trying to do with its collectivism and efforts to impose its agendas on the economy. This is why there is so much pushback from the Left as states start to move away from union tyranny and legislate freedom to work laws, which will allow business to price their goods according to actual metrics such as intrinsic value of the goods and costs of production. This is why so many goods are imported, as the effect of union pricing of labor has made it smarter, from a business standpoint, to operate in economies which do not try to artificially control any aspect of the market, from production to pricing.
I understand that you feel very strongly about whatever it is that you feel so strongly about. (It is often hard to tell, beyond a certain free-floating antagonism toward capitalism and people on the Right and a preference for collectivism.) But if you are going to continue to post here, you are just going to have to man up and be ready to have your “ideas” dissected and challenged.
“Cluster, I think the argument that paying three people to do the work of one would stimulate the economy pretty much sums up both the understanding of economics on the Left and its support for a government that too often does that very thing.”
Unfortunately for you, I did not make that argument.
TRYVASTY
December 15, 2017 / 8:24 pm
If I hire 3 workers to do one person’s job, I still pay those three workers, and they still buy goods.
“Oh, dear, it appears that you, Tryvasty, heretofore addressed in the second person and not the third as this seems to be quite important to you, have become rather irate at my post.”
Lol.
“I am commenting on typical Leftist themes and tactics”
Yep. You have a really stupid thing you do where you repeatedly try to claim that I’m like ALL leftists ever for all of time and space, and then you start arguing against the imagined leftist that says whatever ridiculous thing you want so you can talk to whatever talking points you want. It saves a lot of time and effort over having an actual adult conversation with somebody. It’s nice of you to openly admit your strategy, though.
I skipped over your paragraphs where you still can’t figure out why your grammar is wrong, apparently.
“If you have a personal belief that a business, once it reaches a certain level of production and sales, should just remain at that level and settle for a slightly higher rate of return on what it is already doing, I can’t argue with that.”
My judgement on how businesses should behave is irrelevant. It is true that corporations sometimes save money rather than spending it. Given that as an option, lowering corporate taxes reduces the cost of saving money, making it more appealing relative to hiring workers. Ergo, more businesses will save rather than hiring workers (or investing in durable capital etc). This isn’t rocket science.
“If I hire 3 workers to do one person’s job, I still pay those three workers, and they still buy goods.”
Yes, that definitely contains some of the words you used to misrepresent my position. And you argued against the straw man for paragraphs, even! Well done.
No, sweetie, I never said you are“…like ALL leftists ever for all of time and space.. I just follow the ‘looks like a duck, walks like a duck, quacks like a duck” system for identifying a duck, and when you spout Leftist cant I calls it like I sees it. You may think you are just expounding upon brilliant original Tryvasty thoughts, but as they sound ever so familiar, having been said so often by so many arguing Leftist positions, well—-quack quack quack.
You come here knowing (1) that you have never posted a single thing here that got any respect from anyone, and (2) that you will be challenged when you say something silly. It’s not as if any of this can come as a surprise. If you want to change # 1 then you have to be ready to deal effectively with # 2, and till then you are pretty much stuck with being dismissed as a lightweight. Hint: a good first step would be to man up and admit to what you said, not play a silly semantics game that not every syllable matches up. You said it, I rebutted it. Get over it.
This isn’t rocket science. No, but it is silly. As I said, if you think people who have created, developed and run successful business are more interested in SAVING money than in MAKING money, it might make some kind of sense to a timid and/or lazy businessman. As people who create, develop and run successful businesses tend to be more dynamic than that, I posit that few of them would subscribe to your odd analysis of how to best take advantage of reduced taxes. I suggest that most will be really happy to put that additional money into R&D, hiring new people, expanding markets, etc. I do understand that this is an alien concept to someone with the shall we say unique perspectives on economics you present to us here. That’s OK—-as long as you are not making decisions, you can cherish whatever belief systems make you happy.
So keep spinning your wheels. It is getting tiresome. Whining does that.
Travesty, YOU DID make the argument that paying 3 workers to do 1 persons job was a good thing because three people were getting paychecks. It was a stupid statement and Amazona already slayed you over the issue so I won’t pile on. However, you did offer up more red meat:
It is true that corporations sometimes save money rather than spending it. Given that as an option, lowering corporate taxes reduces the cost of saving money, making it more appealing relative to hiring workers. Ergo, more businesses will save rather than hiring workers (or investing in durable capital etc). This isn’t rocket science.
Corporations do not have savings accounts. And the comment that “more business’s will save rather than hire workers” assumes a static environment which is a mistake made by ALL leftists and particularly the CBO. The economic environment is never static, and corporations are always servicing debt, maintaining facilities, expanding operations, ramping down projects, purchasing new equipment, etc., etc. And amidst all of this is an ever changing marketplace with new competition, new tech advancements that corporations must be ahead of to stay profitable and viable in order to pay taxes so leftist government bureaucrats can criticize them on how they do business. See how that works?
Get to know the concept – velocity of money. It’s the key to a healthy economy.
Exactly, Cluster.
If I were a stockholder in Widgets R Us and went to an annual meeting where CEO Tryvasty told us “We are confidently projecting a 14% profit hike this year, due to the new tax cuts, because we will be spending less money on taxes and will have more for our bottom line” I would be asking some questions.
Q: How is the company going to use that money?
A. Oh, we’re not going to do anything with it. It’s additional profit so we are going to stash it away as an asset of the company.
Q. For how long?
A. For the undetermined future. There is no reason to work harder if we are already ‘making’ more money just by having lower taxes.
Q. How will that protect our market share?
A. ?
Q. I hear that WidgetsWidgetsWidgets is working on a new superwidget that might make our product nearly obsolete in ten years. Why aren’t we going to put our tax savings into R&D so we are not behind the curve as widget technology advances?
A. ?
Q. I heard that Widgets USA is building a new plant that will increase productivity by 15% and will be hiring new workers with those tax savings, which means they will have a lot more product in the market than we will. Won’t that cut into our market share?
A. ?
Q. What about the developing Asian widget market? Can we tap into that if we continue using our existing equipment and labor force?
A. ?
Q. Isn’t your calculation that we will automatically increase our profits by 14% without doing anything based on the assumptions that we will continue to have the same sales volume we have now, and that the other widget companies will be doing the same thing, so the snapshot we have today of the widget market will be unchanged?
A. Uhhhhhhhh………..Just look at this bar graph here. It shows how much more money we will have at the end of the year thanks to the tax cuts. And over here is a pie chart with all those cool colors that shows the same thing. I don’t understand what you are getting at.
Q. I am getting at the need to dump my Widgets R Us stock in a hurry
Get to know the concept – velocity of money. It’s the key to a healthy economy.
A key that not too many people are familiar with or talk about. One of the things, IMO, that the FED has done reasonably well in the last decade is to manage the velocity of money, which is why inflation has been so benign — well, at least the way inflation is currently calculated and reported. But long term low money velocity is also a sign of an anemic economy, which is exactly what we saw during Obama’s 8 years. I’ve posted the St. Louis Fed’s M0 or monetary base chart a number of times over the last decade. The St. Louis Fed site seems to be down this morning, or I’d post it again. It’s a pretty scary looking chart, sort of a ski jump in reverse, but the reason it didn’t create runaway inflation is that most of the money was either in bank vaults or on digital balance sheets instead of in circulation. One of my worries (but apparently no one else’s worry if you follow financial news) is that, if the tax reform results in corporations bringing back trillions of dollars from overseas and pumping it into the economy, it will spike the velocity of money beyond the Fed’s ability to control it, resulting in a huge spike in inflation. I guess we’ll see.
Here’s an informative article about the velocity of money written in layman’s terms.
Spook, thanks for the article. I admit to ignorance about higher finance. I get basic concepts, but details make my brain cells grind like a poorly shifted transmission.
Some questions: (perhaps you can answer in a new post, not extending this one, as it’s getting pretty unwieldy)
A couple of years ago I opined that allowing money to be brought back from overseas would stimulate the economy, and I think I remember you saying that this would accelerate the velocity of money too much and create problems. However, if the slow velocity of money we are currently experiencing is due in part to people saving and/or paying off debt, instead of purchasing, wouldn’t the infusion of a lot of corporate money which would be spent on business expansion and so on speed up that velocity and spark the economy?
Also, if money is now being spent to pay off debt, isn’t that a good thing, and something that will self-correct as debt is paid off, if people don’t then incur large amounts of new debt?
Doesn’t your analysis (in your link) when it refers to banks holding more reserves than in the past omit the fact that banks were kind of forced to do this, with the new and onerous regulations placed on lending? I remember trying to get a business loan in 2011 and being tentatively approved in several banks, only to have it fall through within days as the banks got a pile of new regs. The officers I talked to were pulling their hair out, because they wanted to loan and couldn’t.
It seemed to me that the article said one reason for low money velocity is that people are saving rather than spending. Also that banks are not loaning out as much money because their return on loans is so low. I can see that if interest rates go up a little, banks might be willing to loan more because their rate of return would rise, but it seems that saving would also increase, for the same reason.
“As I said, if you think people who have created, developed and run successful business are more interested in SAVING money than in MAKING money, it might make some kind of sense to a timid and/or lazy businessman.”
https://apnews.com/675f2537403a4d2cb8ed643711c5c196/Will-US-companies-put-overseas-cash-to-work?-Don%27t-bet-on-it
Here’s the thing. What I have backing up my position is evidence, history, and the CEOs of large corporations out there right now, telling you they are going to do exactly what I’m saying they’ll do. What you have is naive idealistic fantasies about how you wish the world worked. But hey, you can crib from our blusterer-in-chief and call me a lightweight!
“I suggest that most will be really happy to put that additional money into R&D, hiring new people, expanding markets, etc.”
I suggest that giving money to a company already sitting on billions of dollars they can’t figure out how to use profitably won’t change the math on any of that in the slightest. Corporate profits are already the highest they’ve ever been, and it’s still not trickling down. You’re being duped.
“Travesty, YOU DID make the argument that paying 3 workers to do 1 persons job was a good thing because three people were getting paychecks. It was a stupid statement and Amazona already slayed you over the issue so I won’t pile on.”
Nope, still didn’t do that. You guys are still arguing against your imagined caricature of an Evil Librul. I just pointed out that such an inefficiency still doesn’t take money out of the economy in any meaningful way. Feel free to try to continue transforming that into whatever point you’d like to argue against instead, though.
“Corporations do not have savings accounts.”
Apple has $250 billion dollars in cash right now. Feel free to look it up.
“A bunch of stuff about the velocity of money”
You do know that when I talk about how saving money is bad for the economy, it’s because it lowers the velocity of money, right? Or that the whole parable about Christmas being good for the economy despite being economically inefficient was about how it increases the velocity of money?
All I was trying to say from the start is that the government taxing money that would have otherwise been saved and then paying a government employee with it increases the velocity of money.
“One of my worries (but apparently no one else’s worry if you follow financial news) is that, if the tax reform results in corporations bringing back trillions of dollars from overseas and pumping it into the economy, it will spike the velocity of money beyond the Fed’s ability to control it, resulting in a huge spike in inflation.”
See my AP link above. I don’t think you have much to worry about, because large corporations are already not money constrained, and therefore won’t behave like they theoretically should in a perfectly competitive environment.
I suggest that giving money to a company….
Yeah, this is typical Lefty talk. To a Lefty, allowing a company to keep more of what it EARNED is really GIVING it money. This is what we run into all the time—-the concept that nothing is ours, it is all the State’s, and we are only entitled to what the State says we can have.
You do know that when I talk about how saving money is bad for the economy, it’s because it lowers the velocity of money, right? Or that the whole parable about Christmas being good for the economy despite being economically inefficient was about how it increases the velocity of money?
Of course. You mean what you don’t say, just as you don’t mean what you do say. Got it.
The AP “analysis” was mostly if not all speculation, full of “maybes” and “probablys” and general mumbo jumbo, coming from a distinctively Leftist point of view. While on the link I went ahead and read some of the other articles on the page, and found a Leftward bias across the board, except for hard news coverage such as articles about the fires in California. Which is to say a somewhat anti-corporation bias.
As Spook has pointed out, and I paraphrase, if you laid a thousand economists end to end they still wouldn’t reach a conclusion. So your Left-leaning business analysts predict the behavior of a few corporations, others have different perspectives on what is likely to happen when a business is allowed to keep more of its earned profits, and all we can do is wait and see.
The only advantage of your sporadic forays into the blog is your eagerness to give us a peek into the perceptions of the Left (even if you don’t like being lumped in with other people who think the same way, quack quack). It’s never educational but it is kind of informative. We see the strangeness of people like Bernie writ large, but seldom have just a regular bloke trying to explain himself. Two threads that runs through your posts are your basic distrust of the free market system and your cynical attitude toward capitalism. When you refer to a tax reduction as “giving money” to the company that actually earned that money, you pretty much lay out your attitude toward the productive and wealthy, just as when you explained that a corporation with cash assets does so so it will have “…“..money up for them to swim around in..”
But thanks for playing…………
As for the minimum wage argument, that also falls back into the education argument. We are turning out people who can’t read, can’t make change, and basically just can’t think. We are pretty much stuck with this huge pool of unskilled labor, and I think we are just going to have to let them age out, even if that means having them on government assistance for a long time.
What we need to do is explain why there are minimum wage workers. No, these levels of employment are not and never were intended to support families. They pay badly because they demand so little of those getting the money. People who have job skills get paid more. That’s what it boils down to. People who expect to get paid more for simply showing up and not bringing much if anything to the table should not be rewarded for this attitude.
Instead of asking/making companies pay more per hour, what about incentives to companies to offer training for better, better-paid jobs? What about offering incentives to go outside those companies to learn actual trades, such as welding or plumbing? What about a policy that identifies growing needs and tries to get ahead of them with appropriate training for appropriate job skills?
For example, an aging population has different needs than, for example, the post-war population of mostly younger families headed by men and women who could fix fences, change light bulbs, repair lawn mowers, change oil and so on. How many schools are teaching their students how to meet the needs of an aging population—-home repair and maintenance, health care, meal prep, meeting transportation needs, etc? How many junior high and high schools are telling their students the hard cold facts about life after high school, such as the need to have marketable skills? How many are teaching those students that working at McDonald’s can be a career,IF one is willing to put in the extra work and effort to move up within the organization, but otherwise it is an entry level job and will always be paid as an entry level job because its main purpose to the worker is to train him or her on how to be an employee. That is, to show up, to show up on time, to learn a task, to do the task well, etc. How many schools are teaching students about the ladder concept of work–that you start on the lowest rung, and if you can’t figure out how to climb that ladder your view will always be up the butts of those who have.
I just hired someone to help on my farm, and I am paying $20.00 an hour. I could have hired someone for half that, but I decided it was worth the extra ten bucks an hour to get the work done in half the time, to get it done right, and to get it done by someone who has the skill set to do what I need to get done. That is, to visually evaluate every animal every day during feeding for signs of illness or lameness or even just unusual lethargy, to operate my equipment without breaking it, and so on. That is an evaluation every single employer makes, and we need to start training our young people to understand and accept that.
One of the biggest problems with the minimum wage is the ripple effect on all the wages above it. If you raise it from $8.25 to say $15.00, what do you do with all the people who were making $9 or $10, or $11, or $12, or $13, or $14, or $15 and so on? And, of course, automation is a logical byproduct of government deciding what entry level jobs are worth.
average folks just figure that if a person is working, it should be for a wage they can live on. The folks are going to look at it in terms of, “could I live on $8.25 and hour?”, and there answer is going to be a flat “no”, and so they’ll think that paying someone that much per hour just isn’t right
No. NONONONO. The “average person” who is making ends meet knows this is happening for several reasons.
The biggest is that he or she has developed skills that make him or her worth, in the labor market, more money than minimum wage. If a guy has worked his way up in a trade, learned how to develop his skill set, and is making $20 an hour, why is he going to argue that someone who has done none of this, someone who has no marketable skills at all, someone who has trouble counting out change even when the cash register tells him much it should be, should get almost that much? If he knows that in a little time, with a few more skills, he can make $25 an hour, why is he going to be willing to pay more for what he buys just to support overpaying someone who hasn’t made the effort to become a more valued employee?
Your assertion demands that “average folks” have no sense of fairness, no sense that they are where they are because they have worked hard and made sacrifices and by damn expect others to do the same if they want the same outcome.
The “average person” also probably budgets income to get by. That is, no new iPhone every year, no extravagant bills for texting or remote data access, no expensive tattoos or the newest fad in shoes or clothes. The “average person” is a lot more likely to shop with discount coupons, take his own lunch to work, and drive an older used car, and is not impressed by those who are on the government dole who expect—-and often get—–goodies the “average person” has to work, and work hard, for.
The “average person” is not going to be happy about being expected to carry the weight of those who don’t put any effort into their lives, and that’s what paying an extra quarter for a hamburger or an extra dollar for a wrench is going to mean to him.
I agree with you 100% – trouble is, whenever a minimum wage hike appears on the ballot, it gets passed…the people like it. We can (and must) educate better, but that takes time…meanwhile, we need power today for things far more crucial than educating about the minimum wage. I’m willing to take a page out of the other side’s book, throw in a bit of tax and/or regulatory relief and then use the resulting power to get a lot more Conservative things done.
And in the meantime the damage done to the economy, including the rampant inflation created by artificially valuing work, which leads to artificially valuing money, can’t be undone. At least not without a huge amount of pain, and a lot more anger than simply expecting people to up their game will create.
I would much rather incentivize in some some way the advancement of education and development of job skills. Say, for example, incentivizing a McDonald University, where McDonald’s employees can qualify, by being good employees, to attend classes designed to expand their skill sets so they can move up in the company. Ditto for Wal Mart and Sam’s Club, Wendy’s, etc. Wal Mart already prefers to promote from within, but making this more well known to the public and offering ways to develop job skills while being employed at minimum wage would help both company and employee.
Colorado has not become a victim of wildly rising minimum wage—yet—but the last time I went into a McDonald’s I ordered and paid at a kiosk, and when I go to Sam’s Club I pay as I go through their phone app and never have to go through a checkout line. They are cutting employee costs in expectation of being hammered by rising minimum wage laws. And I don’t blame them.
The Left has the whole thing upside down and backwards. The purpose of a business is not to support people who work there. It is to make a profit for the owners, and to do that the business has to be smart in how it handles employment. That means paying a fair wage for the work done, not being a charity and paying more than the job is worth. When society forces the company to do the latter, the company will find ways to avoid doing that.
I bring this up not in order to urge us to abandon Conservatism
Well good thing you said this to open the second paragraph because after the first one I was ready to just abandon 45+ years of conservatism. 🙂
And hey let’s all thank Brian for providing the perfect example of what we’re up against. Brian’s post is a great example of the fact challenged, emotional based political garbage that passes for informed analysis amongst progressives.
Minimum wage should be a “living wage”? Ok, what’s that rate in San Francisco Brian? How about New York? Or El Paso, TX? Do you think the rate would be the same? So the question is then, should the Feds set one minimum wage rate to cover the country, or micro manage every labor market to determine what is a livable wage? And who determines livable? Your standard of existence may not be what I expect, so who is going to pay for that?
Re: tax breaks. The question is not who pays what? The question is how much does the government need? Here’s a little factoid for you Brian – the federal government has spent more money every year than the previous year throughout my entire lifetime. They have never gone with less, ever. The bureaucracies grow, the pensions increase, and the tax payers continue to pay more ….. for what? The 5 richest counties in America surround Washington DC. Now I assume that you Brian as a progressive detest rich people who never seem to have enough, right? Can you see that very dynamic playing out with the people in the federal government? Shouldn’t we start to look at things a little differently?
Education is the key to saving this republic from the destructive left, and honestly the last 8 years of the Obama administration is the perfect case study on the failures of progressive prescriptions.
Education is the key to saving this republic from the destructive left… which is why Betsy DeVos has been savaged, because she thinks schools should actually teach, and supports the freedom of parents to use their tax dollars to choose where to send their children. Taking children out from under the heel of Liberal indoctrination poses a major threat to the control Liberals need.
This is why one of the first acts of the Obama administration was to end the program that gave scholarships to deserving young black students in D.C., to allow them to escape the plantations and prisons of the D.C. “educational” system. To the left, school vouchers and charter schools are just holes cut in the fences they have built around education.
This is why Leftist outsiders have dumped millions of dollars into Colorado school district elections, after those districts elected conservative board members who supported charter schools. In Jefferson County, teachers let students out of class to stand in traffic waving signs complaining about actual history being taught in history classes.
We will see all sorts of attacks on approaches to personal, religious and economic freedom, but the real energy of the Left will be expended on trying to control education.
The dynamic that I find most interesting is the dangerous contrast between the average naive progressive – ie:
Progressives want American workers have good wages and good working conditions. Progressives want to make sure poor people have enough food to eat and decent housing. Progressives want all Americans to have access to good healthcare. Progressives want clean air and water, and safe food to eat.
And the evil controlling, deep state left:
http://dailycaller.com/2017/12/11/the-russia-investigation-circus-is-over-will-there-be-a-parade/
Not to pick on you Brian, but do you honestly think career federal bureaucrats really care about you and your living conditions? Consider that the Obama administration spent between $3.5 trillion and $4 trillion every year from 2009-2016 and then ask yourself, how are the current living conditions in Chicago, St. Louis, and Baltimore? How about the VA hospital? In your opinion, is that a well run organization?
Well, Obama cronies did pretty well for themselves. Michelle’s old buddies who were hired to design the ACA web site made off with billions, while the government had to pay someone else to come in and do the job they never did do. Remember Solyndra? Has anyone done an audit on the VA boondoggle in Colorado, which is years behind and BILLIONS of dollars over the original cost—and still not finished?
Funny how, with all these billions of dollars of OUR money that were spent by the kind, compassionate, want-to-help-the-poor Progressives who were running the government, even when food stamp participation soared, we are still subjected to tearful heart-rending pleas to “help the children” and barraged with claims that some huge percentage of American children “go to bed hungry every night” blah blah blah.
How’s that War On Poverty working out? How has dumping literally trillions of dollars into this scheme changed the profile of poverty in this country? Has anyone tracked where a lot of that money actually WENT? We know a lot of it went to pay people to remain unemployed, and to breed unemployable offspring to line up at the trough, but still, that’s a lot of money to just go into the void.
These are good questions Brian that all of us are waiting for you to answer. Obama damn near doubled the national debt in 8 years which now stands at almost $20 trillion, so Obama spent $10 trillion more over the last 8 years ON TOP of the normal annual spending, and Obama was a progressive dream president, so why didn’t life improve for everyone? We shouldn’t even be having this conversation right? Or do we have to spend more money? And if so, how much?
Not to pick on you Brian, but do you honestly think career federal bureaucrats really care about you and your living conditions?
Well they obviously do. Why else would they create all those nice public housing projects around the country? In all seriousness, I do think that most Liberals care about the less fortunate, but caring is generally enough to make them feel like they’ve done something to help said less fortunate people.
I would like either Brian or Travesty to explain to us all what happened in Venezuela:
Although Venezuelans for years have been fleeing the “socialist revolution” first launched by the late Hugo Chávez in 1999, in recent months the trickle has turned into a flood as living conditions become ever more dire — from hyperinflation to acute shortages of food and medicine to one of the worst homicide rates in the world.
Once touted as a socialist paradise and heralded by many American progressives, Venezuela sits on one of the largest oil reserves in the world, yet still struggles to fulfill their socialist promises. How did this happen travesty? Put your thinking cap on.
The recent revelations of Comey and the antics of Team Mueller are more evidence of how corrupt and political our government agencies have become. Yet, the complicit media glosses over all of it to further their leftist agenda. We are at a bad place and time in this country folks and it’s time to thin the herd:
http://dailycaller.com/2017/12/14/comey-draft-said-it-was-reasonably-likely-that-hillarys-server-was-hacked/
While “rethinking conservative strategies” (some of which sound more like shifting to Liberal strategies) we can take a look at what lies in the future of Leftist strategies.
From a very interesting article on the evolution of both credit and social media in China and how both can allow—or, more importantly, to promote—-expansion of government powers:
“.. in 2014 the Chinese government announced it was developing what it called a system of “social credit.” In 2014, the State Council, China’s governing cabinet, publicly called for the establishment of a nationwide tracking system to rate the reputations of individuals, businesses, and even government officials. The aim is for every Chinese citizen to be trailed by a file compiling data from public and private sources by 2020, and for those files to be searchable by fingerprints and other biometric characteristics. The State Council calls it a “credit system that covers the whole society.”
For the Chinese Communist Party, social credit is an attempt at a softer, more invisible authoritarianism. The goal is to nudge people toward behaviors ranging from energy conservation to obedience to the Party. Samantha Hoffman, a consultant with the International Institute for Strategic Studies in London who is researching social credit, says that the government wants to preempt instability that might threaten the Party. “That’s why social credit ideally requires both coercive aspects and nicer aspects, like providing social services and solving real problems. It’s all under the same Orwellian umbrella.”
https://www.wired.com/story/age-of-social-credit/
(In the United States, the ACA penalty for not buying insurance is a “coercive aspect”, or the stick, while the promise of idyllic low cost health insurance was the carrot. Just one example of the Left’s ongoing pressure to force us, one way or another, into its template.)
Thinking about what Bri an and Try wrote earlier has been bugging me all day. My first thought was that they are either mis-informed or mis-educated. That got me to thinking, what if they have just relied on a re-write of history. I started surfing for info on the Reagan years, and came across this WAPO article from 2015 that turns out to be dishonesty writ large. Take, for example, their contention that federal revenue (from the numbers it appears to be revenue from individual income taxes) rose by 75% from 1980 to 1988 (never mind that Reagan was not in office in 1980), but only 25% after inflation. Now I had to take 5th grade arithmetic 3 times, but even I could figure out that, in order for 75 to be reduced to 25 over 8 years, inflation would have had to average over 11%. Inflation during Reagan’s 8 years was as follows:
1981 – 10.35%
1982 – 6.16%
1983 – 3.22%
1984 – 4.3%
1985 – 3.55%
1986 – 1.91%
1987 – 3.66%
1988 – 4.08%
Contrast that to inflation during Carter’s 4 years:
1977 – 6.5%
1978 – 7.62$
1979 – 11.22%
1980 – 13.58%
And yet, if you relied on the WAPO article as the truth, you believe that things were much better during Carter’s term.
I used to carry a card in my wallet with all the economic numbers from the 80’s that I got from the Statistical Abstract of the United States at the Library (before Internet). I’ll bet if I were to go back and get those numbers they would be completely different from what is reported about that era today.
Just as an aside, to be realistic you’d have to consider that 1981 was actually Carter’s last budget year, and 1989 was Reagan’s last budget year. That makes the numbers even more favorable for Reagan, as Carter’s 4 year average (1977 – 1981) becomes 10.69% (Lightbulb! WAPO confused Carter’s number with Reagan’s numbers – probably an honest mistake), and Reagan’s 8 year average becomes 3.96%.
Of course anyone who was not alive back then doesn’t remember the two terms that dominated the Carter era: stagflation and the misery index. I doubt you’ll find mention of either in any high school or college history course today.
And today Bri thinks that tripling the labor cost of producing a product without increasing the value of the product will not lead to inflation, as the company tries to compensate for the higher labor costs by raising the price to the consumer.
Or he thinks the company should just give up on that nasty old “profit” idea and be like a Dem administration, just handing out more money than comes in.
BTW, we are already hearing from the Left how much better things were during the Obama years, and how the improved economy is due to something he did. No one knows exactly what that “something” was, but it was sure nifty.
If their knowledge of economics came from a classroom, for which they actually paid tuition, they should demand a refund.
Amazona,
In June 2007, the minimum wage was $5.15. From July 2007 to July 2009, the minimum wage increased 40% to $7.25. Where was all of the inflation this was supposed to cause? From 2007 through 2009, inflation averaged less than 3%. Corporate profits were higher in 2010 than in 2006 or 2007.
If minimum wage increases causes business profits to go down, why is it that corporate profits were higher in 2010, after the minimum wage increased 40%, than in 2006 and 2007 before the minimum wage increased 40%?
Actually my poor math skills are on display again. For the 75% growth in revenue from 1980 to 1988 to have been reduced to 25%, average annual inflation would have to have been nearly 13%. The folks at the Washington Post must be even worse at math than I am — or dishonest. I’m betting on the latter.
Retired Spook,
If you look at revenue in constant dollars, tax revenue decreased from 1981 – 1984. In 2009 dollars, from 1977 – 1981, tax revenue increased over $200 billion. From 1981 – 1984, tax revenue decreased approximately $80 billion.See page 29 of the following document:
Click to access hist.pdf
Constant 2009 dollars are in column 4.
Net Neutrality explained:
Just the fact that it’s a Liberal idea, instituted under a Liberal president, with millions of Soros dollars behind it and supported by Google, Amazon, Netflix, etc., is enough to make even a casually woke (a little Millennial lingo there) person at least skeptical.
Milo does a great job of explaining the issue ….. net neutrality is just another liberal effort to make some people more equal than others.
That questioner sure didn’t like what he was hearing, though, did he? He was grinding his teeth and looked VERY unhappy at getting a real-life lesson where he thought he would be getting more validation for expanding government controls. Poor baby.
Here is “conservative” republican and MSNBC panelist Steve Schmidt describing criticism of deep state DOJ and FBI bureaucrats:
“That is no longer a news organization. That is what American state media looks like. That is what White House-controlled in-the-service-of-the-president misinformation looks like. That is indistinct from propaganda in authoritarian countries. It is aimed directly at weakening essential institutions and misinforming the American people. It is appalling.”
Got that? The deep state integrity should never be questioned. Unless of course they are investigating Democrats. How you doing out there Ken Starr?
Let’s make that statement accurate, shall we?
“
That is no longer a news organization. ABC, NBC, CBS, the NYT, MSNBC, CNN and the rest of the Agenda Media are no longer news organizations. That is what American state media looks like. That is whatWhite House-controlled in-the-service-of-the-presidentLeftist-controlled misinformation looks like. That is indistinct from propaganda in authoritarian countries. It is aimed directly at weakening essential institutions and misinforming the American people. It is appalling.”There. Now it makes sense.
Thank you President Trump:
…..the U.S. military now has the authority to take the fight to the enemy in a new way. Under the Trump administration, the military now has greater freedom and independence with regard to how it chooses to engage the enemy.
“The new strategy highlights that this is a new war,” he told reporters Tuesday. “The gloves are off. We’ve got now these authorities we need to be able to go and target the Taliban network … That is our new strategy going forward and it’s definitely been a game-changer and the Taliban is definitely feeling it.”
JEFF SESSIONS NEEDS TO RESIGN. HE IS TOO WEAK, AND TOO MUCH OF AN ESTABLISHMENT MEMBER TO BE AG.
The plot thickens.
(perhaps you can answer in a new post, not extending this one, as it’s getting pretty unwieldy)
I minored in economics back in the mid 60’s and haven’t EVER worked in the field, so at least in terms of current day theory, I probably know just enough to be dangerous. One of the first problems you encounter if a bunch of corporate cash is returned home as a result of the tax bill is that it all depends on the amount of cash and how it’s used. At least that’s my take. If the Count still monitors this blog, I’d be interested in his thoughts.
I think back to the 1980’s when it took a couple years of double digit interest rates to suck excess money back out of the economy, (people who weren’t alive at the time would probably accuse me of lying when I say I earned 18% on a money market fund, and, conversely, people who just got a 3.5% mortgage can’t relate to 22% mortgages) and the increase in the monetary base at that time was statistically insignificant:
https://tradingeconomics.com/united-states/money-supply-m0
Just as an aside, the Obama years on the M0 chart are pretty hard to miss.
Even M2, which is the most widely used money supply metric climbed at a steeper rate in the 80’s but didn’t spike: (and nothing like the rate of rise in the last couple decades)
https://tradingeconomics.com/united-states/money-supply-m2
All the changes in both of those measurements are the result of manipulation by the Fed. The last figure I saw for the amount of cash held overseas by U.S. corporations from a few months ago was $2.6 trillion, or nearly 15% of U.S. GDP. To the best of my knowledge there’s never been a return of privately held capital of that magnitude, and it’ll take someone a whole lot smarter and more knowledgeable than I to predict what effect that may have. And, quite frankly, I’ll bet if you asked 10 economists to predict you’d get almost that many different predictions. So, in answer to your question, I don’t think there’s any doubt that returning corporate cash will stimulate the economy; the only question is at what risk in terms of volatility, inflation and interest rates. I don’t have any debt, so double-digit interest rate would be a plus for me; not so much for a lot of people.
I think it was Rich Lowery on Fox News Sunday this morning who said, in response to doom and gloom predictions by the two Libs on the panel, that one of two things is going to happen as a result of the tax bill. If economic growth stays above 3%, maybe even spiking to 4 or 5 or 6%, the Dems’ criticisms are going to fall on deaf ears. If everything tanks, the Dems are going to have a solid argument come 2018 and 2020. Either way, we’re going to know in the not-too-distant future.
I object to the premise that it is conservative ideology to have double taxation of corporations in the first place. No need to tax credit wages when the corporations should have a zero tax rate anyhow.
Still, the new tax bill did get rid of the one corporate loophole that closely resembled your suggestion to tax credit each hourly dollar spent on wages above a certain amount. There was a domestic productions activities deduction that was based on 50% of wages paid. That was eliminated. Not phased out like it was phased in, just eliminated.
Not sure why it was eliminated, it was a tool that rewarded manufacturing here rather than manufacturing abroad.