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  #151  
Old 09-19-2018, 07:30 AM
Ravenman Ravenman is offline
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Originally Posted by HurricaneDitka View Post
So that's a "yes" then? People should vote in favor of what you (or Little Nemo) consider their economic interests to be, not what they do?
Let’s consider my economic interest in this question: I support spending to have a strong defense as well as: not hurting seniors by rationing their heath care or reducing the Social Security that keeps many off the streets; foreign aid programs that put the US in a leadership position in the world and address scourages like AIDS; I like roads and bridges that are smooth and also improving infrastructure with new technologies; and support a tax system that would generally pay for these things except during unusual times like war or recession.

As far as I can tell, you want to be able to afford a fancy new grill or home theater system every year.

The way I see it, you’re looking at what you can get out of the deal and I’m looking at what the country can get out of it.
  #152  
Old 09-19-2018, 07:55 AM
BobLibDem BobLibDem is offline
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How much did you pay in state taxes last year? You know you can still claim the first $10,000, right? I would be surprised if you pay more than that.
Now wait a cotton-picking minute! I thought with the standard deduction going way up to $20,000 for a married couple, that your itemized deductions would have to exceed $20,000 before they counted. Most folks aren't going to be itemizing anymore as far as I can tell.
  #153  
Old 09-19-2018, 09:12 AM
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The problem with "cuts to Medicare" is that that conflicts with an important progressive goal: The public should afford medicine and medical services to all. Instead of cuts to "Medicare" we need cuts to unnecessarily high medical costs. This is the subject of another thread.

If by "cuts to Medicare and SocSec" you mean means-testing, I say no. Means-testing just adds red-tape and increases opportunity for fraud. Give everyone, rich or poor, the benefits of SocSec and Medicare but make payroll taxes less regressive.

And adopt my idea, which increases, in effect, minimum wage but as a benefit rather than burden to employers of low-wage employers! Let the first $15,000 of income be exempt from payroll taxes (both employee and employer portions). The shortfall in revenue should be made up with a carbon tax.

HTH.
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  #154  
Old 09-19-2018, 10:02 AM
HurricaneDitka HurricaneDitka is offline
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The problem with "cuts to Medicare" is that that conflicts with an important progressive goal: The public should afford medicine and medical services to all. Instead of cuts to "Medicare" we need cuts to unnecessarily high medical costs. This is the subject of another thread.

If by "cuts to Medicare and SocSec" you mean means-testing, I say no. Means-testing just adds red-tape and increases opportunity for fraud. Give everyone, rich or poor, the benefits of SocSec and Medicare but make payroll taxes less regressive.

And adopt my idea, which increases, in effect, minimum wage but as a benefit rather than burden to employers of low-wage employers! Let the first $15,000 of income be exempt from payroll taxes (both employee and employer portions). The shortfall in revenue should be made up with a carbon tax.

HTH.
I don't know, Try2B, does he sound "willing to negotiate" to you?
  #155  
Old 09-19-2018, 10:05 AM
HurricaneDitka HurricaneDitka is offline
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... As far as I can tell, you want to be able to afford a fancy new grill or home theater system every year.

The way I see it, you’re looking at what you can get out of the deal and I’m looking at what the country can get out of it.
I'd like everyone to be able to afford a fancy new grill or home entertainment system. Sure, there's an aspect of my support for tax cuts that's motivated by what it does for me personally, but there's also an aspect of it motivated by my thinking that it's better for the country if more Americans get to keep more of what they earn. As hard as it is for your side to understand sometimes, there are decent people on both sides doing what they sincerely believe is best for the country.

Last edited by HurricaneDitka; 09-19-2018 at 10:06 AM.
  #156  
Old 09-19-2018, 10:15 AM
KidCharlemagne KidCharlemagne is offline
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The ignorance of economic principles by both politicians and the public is the single most frustrating aspect of observing politics for me. It utterly kills me that people think Trump is responsible for this economic boom. We'd have had one regardless of who was president. The stage has been setting since 2008.

Trump's policies are a disaster for the American economy. Tax cuts at full employment just cause inflation, a bubble in equities, and a bigger deficit. His trade policies are, honestly I can't even bring myself to talk about them. And he'll be out of office when the rent comes due and it will be blamed on the Democrat who's in office. I think the stage is being set for a one term Democratic president whose supposed stewardship of recessing economy will keep the Republicans in power for the proceeding decade. God it's so depressing. Fyi I'm a former Republican.
  #157  
Old 09-19-2018, 11:39 AM
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Which states have "regressive" income taxes?
The ones with sales tax instead of income taxes are considered regressive.
  #158  
Old 09-19-2018, 11:44 AM
HurricaneDitka HurricaneDitka is offline
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The ones with sales tax instead of income taxes are considered regressive.
That's not what RTFirefly said:

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Originally Posted by RTFirefly View Post
... State income taxes are usually regressive too...

Last edited by HurricaneDitka; 09-19-2018 at 11:44 AM.
  #159  
Old 09-19-2018, 12:11 PM
Ravenman Ravenman is offline
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Originally Posted by HurricaneDitka View Post
I'd like everyone to be able to afford a fancy new grill or home entertainment system. Sure, there's an aspect of my support for tax cuts that's motivated by what it does for me personally, but there's also an aspect of it motivated by my thinking that it's better for the country if more Americans get to keep more of what they earn. As hard as it is for your side to understand sometimes, there are decent people on both sides doing what they sincerely believe is best for the country.
Talk about the pot calling the kettle black. My side has a hard time understanding that the other side has good people?

I posted a substantive response why I disagree with exactly what you’ve argued several times - $190 billion is debt is a good deal because you got $2,000 out of it - and you turn it into “why is your side so mean!” pout session.

Look, I’m not the guy who starts a thread every ten days to stick it to the other side as large, to say nothing of the other insulting things you’ve said about liberals.

I’ve said this before in many contexts, I bet you’d be a fun guy to watch a football game with or whatnot. That doesn’t mean I have to agree with your politics.
  #160  
Old 09-19-2018, 12:41 PM
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<checks forum, confirms that it is indeed Great Debates>

Wow HD, you make a very convincing rebuttal.
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Originally Posted by steronz View Post
I'm astounded that you spend so much time talking about policy when you clearly don't give a shit about it.
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Originally Posted by steronz View Post
If we pay more for the bridge it really pisses off the libtards
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Originally Posted by steronz View Post
Look what happened, spending went up, taxes.went down, deficit boomed. Fucking D's indeed.

Low. Information. Voter.
Knock it off. If you can't or won't respond without personalizing your arguments, then don't.

[/moderating]
  #161  
Old 09-19-2018, 02:45 PM
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Try2B Comprehensive Try2B Comprehensive is offline
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I don't know, Try2B, does he sound "willing to negotiate" to you?
Well sure. He's still talking to us instead of saying "absolutely no way!" and walking away from the table.

Try this: first acknowledge his concerns by demonstrating that you understand them. He didn't say Medicare can't be touched, he wants to reduce costs while providing the same level of care. Really, I think everyone who is not a pharma lobbyist could support at least that much. Try to find out how much costs could be reduced- I bet there is a big spending cut right there.

He doesn't want to means test SS. I don't want to either: it isn't a charity program, everyone pays into it so that they can benefit later. See how he reacts to cutting 5% from the benefits of current recipients, 10% from the benefits of incoming recipients, and raising the cap on income taxes for SS. It isn't a perfect solution but I don't think there will be an easy way out of this.

Find common ground: I bet he would be cool with taxing the rich and giving relief to people of modest means. Find out what he would cut. Try to get him talking about what he Is willing to do instead of just where he drawsthe line and see where it goes. He's not a monster- the bad guys in almost any government story are actually the lobbyists and the liars with the big media megaphones, not "liberals" or "conservatives". Read the first 150 pages of A People's History of the United States to get an idea of how elites have always sown division among the common people to prevent them from acting in their own best interests. Don't let stuff you hear on TV about liberals poison your view of guys like him- we have more in common than differences.
  #162  
Old 09-19-2018, 09:55 PM
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Trump's policies are a disaster for the American economy. Tax cuts at full employment just cause inflation, a bubble in equities, and a bigger deficit. His trade policies are, honestly I can't even bring myself to talk about them. And he'll be out of office when the rent comes due and it will be blamed on the Democrat who's in office. I think the stage is being set for a one term Democratic president whose supposed stewardship of recessing economy will keep the Republicans in power for the proceeding decade. God it's so depressing. Fyi I'm a former Republican.
I don't know. George W. Bush took office with a balanced federal budget and by the end of his term there were big deficits and the economy was on the verge of collapse. If the electorate had any kind of memory that would have paved the way for a long succession of Democrats. But just eight years later Republicans were saying "George who? Never heard of him. Tax cuts!!"
  #163  
Old 09-20-2018, 07:51 AM
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However, I feel like media outlets like FOX aggressively seek to limit the conversation to this one single point. "The average American taxpayer is paying $x less in taxes! That's good for you, end of story, end of discussion, nothing more to see here!" ...
The simplistic attitude of GOP preachers and the Americans they gull certainly is part of the problem. One message board participant, when asked to compare his $1500 windfall with trillions for the super-rich had no answer except to say he was getting $2000, not $1500! (And, as someone in this thread pointed out, that $2000 might turn into $1500 when the April reckoning comes.)

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At a time of general national economic well-being, the country is amassing $1 trillion a year in debt....

I believe the true message out of the GOP is, " Fuck you, American public. We are openly robbing you to benefit our wealthy sponsors, and if you think you have a voice in your own government, you are a sucker and a rube."

Point 3- The consequences of the tax cuts will be far worse than the benefits for people like me. This final point is the real thrust of this debate. I cannot see how $1 trillion deficits are justified under the current circumstances. ... I see it as a massive scheme. As the debt rises to $20 trillion, maybe $30 trillion and beyond, well, ask yourself, who has the money to buy $30 trillion in bonds? It isn't me with my extra $2000 in tax cuts, it is the already super wealthy. As interest rates rise, the public obligation to bondholders will surpass $1 trillion PER YEAR in interest payments alone, payments from the public to mosly super wealthy bondholders.

>>>This is a long post, so let me repeat that. As interest rates rise, the public obligation to bondholders will surpass $1 trillion PER YEAR in interest payments alone, payments from the public to mostly super wealthy bondholders.
Yes, interest on the "public debt" is already almost as large as the total Medicaid budget. interest rates are continuing to rise; interest may soon exceed Medicare spending! And that's just "public" debt interest — The $310B figure for 2018 doesn't include interest on bonds held by the SocSec Trust Fund, the FRB, etc. Anyone who doesn't understand why proper accounting should consider that interest also, report to Econ 1 (down the hall, turn left at the Pit).

But I think you mischaracterize the holders of Treasury debt. Sure the rich own a lot more than the working class, but most of their assets are elsewhere. Foreign banks own a lot. Institutional investments (funds, insurance companies, pensions) that serve the public own a lot too.

If the U.S. were to pay back its debt 40¢ on the dollar (as Trump liked to do with his hotels' debt), the U.S. would have a windfall profit of $12T on a $20T debt. As debt mounts the temptation to do this might become irresistible to "thinkers" like Trump. This can be done either with a de facto devaluation of the dollar, or (as Trump seems to prefer) by explicitly renouncing debts. Either way, the big loser would NOT be the super-rich, it would be the long-term future prosperity of the U.S. The Dollar would no longer be respected. That would be the way to push the U.S. into the status of a Greece or Venezuela, not — as some right-wingers pretend — by instituting UHC.

~ ~ ~ ~ ~ ~ ~ ~

If you want to discuss improvements to the U.S. tax system we need to know whether we're "blue-skying" with everything on the table, or speaking of incremental improvements to the present system. Given present politics it's difficult to imagine major change for the better: If one party will vote unanimously No, the other party must find agreement among themselves with no bipartisan help.

I would propose some major changes that would provide better incentives. For example, reduce the employer burden of payroll taxes by $X and recover the revenue with $X of carbon tax. There! Create an incentive to employ human labor; and an incentive for better energy. But discussing this with a Republican might be difficult. Waste time helping them grasp that $X minus $X equals Zero, and they'll whine "Give you $X it'll become $2X in no time!")

As another example, the U.S. could raise money by taxing pollution. This is better than cap-and-trade for several reasons — and is one area where the Board's Intelligent Libertarian and I might agree — but only cap-and-trade was politically possible.

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Originally Posted by Try2B Comprehensive View Post
Try this: first acknowledge his concerns by demonstrating that you understand them. He didn't say Medicare can't be touched, he wants to reduce costs while providing the same level of care. Really, I think everyone who is not a pharma lobbyist could support at least that much. Try to find out how much costs could be reduced- I bet there is a big spending cut right there.

He doesn't want to means test SS. I don't want to either: it isn't a charity program, everyone pays into it so that they can benefit later. See how he reacts to cutting 5% from the benefits of current recipients, 10% from the benefits of incoming recipients, and raising the cap on income taxes for SS. It isn't a perfect solution but I don't think there will be an easy way out of this.
High Medicare costs are due to high health costs in general. Progressives want to provide health care to Americans; Medicare changes intended to deny care are undesired. Ask your GOP friends what they think about Bush's Congress deliberately increasing Medicare costs to benefit Big Pharma.

I have no particular problem with reductions to Social Security but don't want to debate details. I get full SocSec even though I'm retired in a low-cost country. Perhaps people like me should have benefits reduced.

But people are just plain confused if they think SocSec is the big problem with government spending. SocSec is, more or less, a self-funding system. That these pensions are included in government budget, while most health insurance is not, can be considered happenstance. The reason the GOP is left with SocSec and Medica{re,id} to cut is that everything else (except military and interest) has already been cut to the bone. U.S. government spending is NOT anywhere near an historic high, when intelligently measured, but right-wingers refuse even to try to understand this.

As a demonstration of how insincere the GOP is about cutting spending, recall that they lay off IRS employees as part of "general cost-savings." The IRS is a "profit center." A good IRS examiner is literally worth his weight in gold! Yet a typical Gopster won't think beyond "Taxes is bad; the IRS is taxes; therefore IRS is bad." I honestly wonder whether they understand that IRS doesn't set tax rates; it just enforces the (already low) tax rates mandated by Congress.
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  #164  
Old 09-20-2018, 11:35 AM
etasyde etasyde is offline
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But people are just plain confused if they think SocSec is the big problem with government spending. SocSec is, more or less, a self-funding system.
I agree with most of what you said, but I'm going to nitpick here. SS is only self funding when the initial premises behind it - namely that the US, or more accurately the Fed, wouldn't go into totally uncharted waters and nuke the interest rate from the almost perpetually over 5% average that existed before to nearly 0-2% for decades - remains true. Remember, most of SS is in things like bonds or other similar securities and the interest on "safe" assets has been dismal and the "unsafe" assets blew up in 2008. Mortgage Backed Securities loaded with junk bonds and similar financial crappery were AAA rated and made it into plenty of 401K's and pensions, but I don't honestly know if they were allowed in the SS accounts.

The growth in the account is exponential/compound based on those interest rates. Since rates have been so low for so long, the projected curve has diverged dramatically from the actual account's curve, which creates a shortfall that will exponentially grow. Right now, the difference is small, but it will get huge as time passes and more withdrawals begin to be made. You can't really "catch up" to exponential growth without some insane interest rates for a long time, rates that'd be impossible to maintain and wreak havoc on the economy.

Actually, I believe SS is solvent so long as average interest rates are 7.5% because they were particularly optimistic at the time. Medicare I believe is self funding at 5%. Anyone can correct me, though, as I'm not positive. Either way, it's not able to keep up with the interest rates this insanely low.
  #165  
Old 09-20-2018, 01:21 PM
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I agree with most of what you said, but I'm going to nitpick here. SS is only self funding when the initial premises behind it - namely that the US, or more accurately the Fed, wouldn't go into totally uncharted waters and nuke the interest rate from the almost perpetually over 5% average that existed before to nearly 0-2% for decades - remains true. Remember, most of SS is in things like bonds or other similar securities and the interest on "safe" assets has been dismal and the "unsafe" assets blew up in 2008. Mortgage Backed Securities loaded with junk bonds and similar financial crappery were AAA rated and made it into plenty of 401K's and pensions, but I don't honestly know if they were allowed in the SS accounts.
The Social Security Trust Fund is entirely invested in Government-issued bonds that are constitutionally guaranteed (under the 14th Amendment) to be repaid at the terms of issuance. These bonds have literally nothing to do with any securities issued in the private sector, whether AAA rated, junk bonds, or anything in-between.

To emphasize once more: what may happen on the market for stocks and bonds has nothing to do with the Government bonds held in the Social Security Trust Fund.
  #166  
Old 09-20-2018, 01:22 PM
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High Medicare costs are due to high health costs in general. Progressives want to provide health care to Americans; Medicare changes intended to deny care are undesired.
On average, doctors and health care providers lose money treating Medicare patients. About 35% IIRC.
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The reason the GOP is left with SocSec and Medica{re,id} to cut is that everything else (except military and interest) has already been cut to the bone.
Can you please mention the spending cuts that have been made to programs other than the military and interest and Social Security and Medicare? TIA.

Regards,
Shodan
  #167  
Old 09-20-2018, 01:28 PM
Shodan Shodan is offline
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The Social Security Trust Fund is entirely invested in Government-issued bonds that are constitutionally guaranteed (under the 14th Amendment) to be repaid at the terms of issuance. These bonds have literally nothing to do with any securities issued in the private sector, whether AAA rated, junk bonds, or anything in-between.

To emphasize once more: what may happen on the market for stocks and bonds has nothing to do with the Government bonds held in the Social Security Trust Fund.
This post is quite correct. The federal taxpayer is on the hook for the SSTF no matter what the market does.

Regards,
Shodan
  #168  
Old 09-20-2018, 01:40 PM
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On average, doctors and health care providers lose money treating Medicare patients. About 35% IIRC.
Cite, please?
  #169  
Old 09-20-2018, 01:56 PM
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Sum up Trump's actual and proposed tariffs, and he is the middle class tax hike champion:
President Trump recently announced plans to impose a 10 percent tax on $200 billion of imports from China effective September 24, escalating to 25 percent effective January 1, 2019. When added to tariffs that have already been implemented, total trade taxes imposed on American consumers and businesses via unilateral executive action exceed all the taxes included in President Obama’s Affordable Care Act (ACA).
Caveats at link: not all the tariff hikes have gone through. But there's a nice chart comparing Obamacare taxes (levied mostly on the rich) and Trump tax hikes (levied mostly on the middle class). $34 billion for Obama and a whopping $132 billion for Trump.

https://www.motherjones.com/kevin-dr...r-of-all-time/

As long as favored plutocrats are protected, Republicans think tax hikes are just great. In deeds of course, not words.
  #170  
Old 09-20-2018, 02:02 PM
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On average, doctors and health care providers lose money treating Medicare patients. About 35% IIRC.
I don't understand this. If I was a new doctor, and I only saw Medicare patients, I wouldn't make any money?
  #171  
Old 09-20-2018, 02:06 PM
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The Social Security Trust Fund is entirely invested in Government-issued bonds that are constitutionally guaranteed (under the 14th Amendment) to be repaid at the terms of issuance. These bonds have literally nothing to do with any securities issued in the private sector, whether AAA rated, junk bonds, or anything in-between.
Alright, I was unaware the SS fund was unable to purchase anything but treasuries (I had thought it was a large portion by requirement, not 100%), but that just makes my ultimate point stronger. Interest rates on government issued bonds are the lowest of what was mentioned, meaning the SS fund is literally scraping the mathematical barrel and not presently wholly self funding.

It would be, if not for the Fed, but the conditions for which the SS model was designed are not being met (average interest rates) and said model cannot be upheld, at current rates, past 2034. Medicare suffers from the same issue, but clocking in at about 2026 by latest estimates.

Last edited by etasyde; 09-20-2018 at 02:07 PM.
  #172  
Old 09-20-2018, 02:06 PM
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The Social Security Trust Fund is entirely invested in Government-issued bonds that are constitutionally guaranteed (under the 14th Amendment) to be repaid at the terms of issuance. These bonds have literally nothing to do with any securities issued in the private sector, whether AAA rated, junk bonds, or anything in-between.

To emphasize once more: what may happen on the market for stocks and bonds has nothing to do with the Government bonds held in the Social Security Trust Fund.
Damn straight. Amazing the number of ignorant Facebook memes I've seen along the lines of "Congress Stole $2.1 Trillion From Social Security! Make Them Pay It Back! Make It Illegal For Them To Borrow From Social Security Again!" etc. The surplus went into safe government investments. Congress did not steal it.

Now mind you, imagine the fix SS would have been if the Republicans had their way in the late 1990s and had SS invest the surplus in the stock market.
  #173  
Old 09-20-2018, 02:19 PM
Ravenman Ravenman is offline
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Interest rates on government issued bonds are the lowest of what was mentioned, meaning the SS fund is literally scraping the mathematical barrel and not presently wholly self funding.
To the extent that any government debt is an investment by the purchaser, yes. But to my recollection, currently 95%+ of Social Security obligations are paid for with FICA revenues, so any general revenue that is spent on the remainder of obligations is approaching decimal dust.

But that will change over time, by 2033-ish nearly 20% of payments will come from redemption of the bonds. After which point, if nothing happens, the system will be entirely financed by FICA revenue (and payments will be only ~80% of what was promised).
  #174  
Old 09-20-2018, 02:21 PM
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I don't know. George W. Bush took office with a balanced federal budget and by the end of his term there were big deficits and the economy was on the verge of collapse. If the electorate had any kind of memory that would have paved the way for a long succession of Democrats. But just eight years later Republicans were saying "George who? Never heard of him. Tax cuts!!"
This.

I'm still disgusted with how quickly the GOP in 2009-10 was able to shuck off responsibility for the collapse (not to mention the disastrous war in Iraq) and rally behind the nonsense of the Tea Party.

The pushback and obstruction of the GOP, when the nation was reeling from the worst economic crisis in generations -- and the fact that so many Americans fell for it -- should have been a red flag as to what was coming in 2016.
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  #175  
Old 09-20-2018, 02:22 PM
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This post is quite correct. The federal taxpayer is on the hook for the SSTF no matter what the market does.
Until the point it is exhausted and no more bonds remain, of course, at which point obviously no more bonds can be redeemed. And as I just said, payments to retirees will have to be cut.

Unless the law changes, of course -- but there is no mechanism to continue the full payment of benefits through general Government revenues. One could read your post as implying there is.
  #176  
Old 09-20-2018, 02:51 PM
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Can you please mention the spending cuts that have been made to programs other than the military and interest and Social Security and Medicare? TIA.
Here's one!
  #177  
Old 09-21-2018, 01:56 PM
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Yes, interest on the "public debt" is already almost as large as the total Medicaid budget. interest rates are continuing to rise; interest may soon exceed Medicare spending! And that's just "public" debt interest — The $310B figure for 2018 doesn't include interest on bonds held by the SocSec Trust Fund, the FRB, etc. Anyone who doesn't understand why proper accounting should consider that interest also, report to Econ 1 (down the hall, turn left at the Pit).
I think it is just a convention that the public debt be separated from the money the government "owes itself." Am I missing something?

Quote:
But I think you mischaracterize the holders of Treasury debt. Sure the rich own a lot more than the working class, but most of their assets are elsewhere. Foreign banks own a lot. Institutional investments (funds, insurance companies, pensions) that serve the public own a lot too.

If the U.S. were to pay back its debt 40¢ on the dollar (as Trump liked to do with his hotels' debt), the U.S. would have a windfall profit of $12T on a $20T debt. As debt mounts the temptation to do this might become irresistible to "thinkers" like Trump. This can be done either with a de facto devaluation of the dollar, or (as Trump seems to prefer) by explicitly renouncing debts. Either way, the big loser would NOT be the super-rich, it would be the long-term future prosperity of the U.S. The Dollar would no longer be respected. That would be the way to push the U.S. into the status of a Greece or Venezuela, not — as some right-wingers pretend — by instituting UHC.
My thinking on the future of bonds is about as close to a conspiracy theory as I get. I've claimed that besides the long-term plan to destroy SS and Medicare with debt, forces like the Kochs and the Mercers are pulling the strings on their puppets in Congress to issue vast quantities of bonds, exploding the debt and driving up interest rates in order to turn US Treasury receipts into a trillion-dollar-a-year income stream.

I am not 100% sure of this, but my thinking on this comes from articles like The Dark Decade Ahead. It seems like every financial news outlet is making an argument like this these days, and it does not seem to be a case of both-siderism where here's an article promoting a bull run forever, and the perfectly balanced counter-argument that things will turn south. No, the more I look into it, the more it seems like the evidence is on the side of the bear callers:
Quote:
The U.S. stock market is overvalued. Sure, I know the S&P 500 Index is trading at a perfectly reasonable 16.3 times earnings based on 2019 Q4 non-GAAP estimates that may never come to pass, but I prefer to work with numbers that I can point to as more officially in the books. And even if I concede that 2018 Q3 GAAP earnings come in as currently forecasted (they will almost certainly end up somewhere below), we find that the cyclically adjusted price to earnings ratio (CAPE)) on the S&P 500 Index over the past 10 years is currently a frothy 32.6 times. This ranks in the third percentile of highest readings on this measure over nearly 140 years of stock market history. Now for those CAPE haters out there, it should be noted that today's P/E ratio based on 12-month GAAP earnings is nearly just as high in the fifth percentile, so today's song is essentially the same whether you adjust for the business cycle or not - stocks are expensive.
Quote:
A few key takeaways are quickly apparent. First, the more expensive the stock market becomes at any point in time, the worse stocks have performed over the subsequent 10 years. And given where we are with valuations today, the best real returns investors should expect from the U.S. stock market over the decade ahead are relatively modest at around +2% annualized at most. Instead, a more realistic annualized real return expectation for U.S. stocks as implied by the red trendline on the chart is more in the neighborhood of -2% to -3% annualized. For all of those recently minted passive index investors out there, I hardly think their expectation to lose money after adjusting for inflation on an annualized basis over the next decade is their primary objective. Yet this is what they have set themselves up for today.
If you're a billionaire at the end of an historic bull run and you want your fortune to continue to grow rather than get eaten by the business cycle, where do you invest your money? Gotta get out of stocks, but you can't exactly invest that kind of money in CDs. How about inducing the US government to issue another $10 trillion in bonds, driving the interest rate up to 5%-7% or more? Then, while the stock market languishes, you continue to make a killing and all those rubes who thought their government worked for them can foot the bill.

Paranoid perhaps, I admit it. But we are on such a dumb path, on such a colossal scale, that I can't help being suspicious. Do you think I am just seeing the machinations of global banks and giant public pension funds and viewing it through too sinister a lens?

Quote:
If you want to discuss improvements to the U.S. tax system we need to know whether we're "blue-skying" with everything on the table, or speaking of incremental improvements to the present system. Given present politics it's difficult to imagine major change for the better: If one party will vote unanimously No, the other party must find agreement among themselves with no bipartisan help.
Blue sky. I want to Solve The Problem. If we cut the debt in half or more by the end of 30 years, without destroying the safety net, I'd consider that success.
Quote:
I would propose some major changes that would provide better incentives. For example, reduce the employer burden of payroll taxes by $X and recover the revenue with $X of carbon tax. There! Create an incentive to employ human labor; and an incentive for better energy. But discussing this with a Republican might be difficult. Waste time helping them grasp that $X minus $X equals Zero, and they'll whine "Give you $X it'll become $2X in no time!")
I love stuff like this. If you are a person like me who is in contact with lots of working people, well, maybe they are Democrats, maybe they are conservatives, maybe they are religious or not, maybe they are educated or not, but what they have in common is that they are working hard and not exactly getting ahead. Working people of modest means could use support- that's who Trump promised to help during his campaign, and that is the evil irony of the GOP today, to convince people they are the ones to help them and then completely screw them over in favor of the billionaire class. So yes,

Climate change is bad for the future of working people of modest means. We simply must address it, no matter how much screaming there is from the liars and the people who just don't get it.
Quote:
As another example, the U.S. could raise money by taxing pollution. This is better than cap-and-trade for several reasons — and is one area where the Board's Intelligent Libertarian and I might agree — but only cap-and-trade was politically possible.
Maybe. I'd need to see more details to understand what you mean here.

Quote:
High Medicare costs are due to high health costs in general. Progressives want to provide health care to Americans; Medicare changes intended to deny care are undesired. Ask your GOP friends what they think about Bush's Congress deliberately increasing Medicare costs to benefit Big Pharma.
Right. It is the kind of thing that might lead one to believe that the billionaire class is orchestrating scams on a massive scale through their network of bought-and-paid-for Congress critters.

Quote:
I have no particular problem with reductions to Social Security but don't want to debate details. I get full SocSec even though I'm retired in a low-cost country. Perhaps people like me should have benefits reduced.

But people are just plain confused if they think SocSec is the big problem with government spending. SocSec is, more or less, a self-funding system. That these pensions are included in government budget, while most health insurance is not, can be considered happenstance. The reason the GOP is left with SocSec and Medica{re,id} to cut is that everything else (except military and interest) has already been cut to the bone. U.S. government spending is NOT anywhere near an historic high, when intelligently measured, but right-wingers refuse even to try to understand this.
Well, balancing the budget and preserving SS are both getting lumped into this discussion. If nothing is done, benefits take a big stair-step down and probably continue to dwindle from there. I expect the GOP to seize on this event to declare SS "bankrupt" and push for the end of the program. We don't want that, and we don't want the big stair-step either.

I don't want to cut it at all, but something has to give. Also, I think a plan that relies entirely on raising taxes without cutting any spending would be seen as in bad faith by "the other side" and would make it harder to achieve. We're talking about raising an addition $1 trillion a year in taxes in this case. All government revenues currently amount to about 30.7% of GDP right now, so it is do-able but would come as a big shock. And contemporary history shows that American politics is not very good at agreeing to such "take your medicine" solutions- it would take an awful lot of stoicism to stick with that plan long enough for the benefits to appear. Any real solution will be like that though. Just my opinion, what do you think?

Quote:
As a demonstration of how insincere the GOP is about cutting spending, recall that they lay off IRS employees as part of "general cost-savings." The IRS is a "profit center." A good IRS examiner is literally worth his weight in gold! Yet a typical Gopster won't think beyond "Taxes is bad; the IRS is taxes; therefore IRS is bad." I honestly wonder whether they understand that IRS doesn't set tax rates; it just enforces the (already low) tax rates mandated by Congress.
The GOP acts like it is running a melodrama much of the time. The IRS- they are in the black hats! <boo hiss> They are in cahoots with those America Hating Liberals (also in black hats) <boo hiss> Here comes our hero in the White Hat, cutting that dastardly IRS <cheers hooray> (but all they've accomplished is making it easier for the wealthy to cheat on their taxes, something the rubes never seem to notice.) Keep your eye on the birdie, folks!
  #178  
Old 09-21-2018, 03:10 PM
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Originally Posted by Try2B Comprehensive View Post
[1] My thinking on the future of bonds is about as close to a conspiracy theory as I get. I've claimed that besides the long-term plan to destroy SS and Medicare with debt, forces like the Kochs and the Mercers are pulling the strings on their puppets in Congress to issue vast quantities of bonds, exploding the debt and driving up interest rates in order to turn US Treasury receipts into a trillion-dollar-a-year income stream.

I am not 100% sure of this, but my thinking on this comes from articles like The Dark Decade Ahead. It seems like every financial news outlet is making an argument like this these days, and it does not seem to be a case of both-siderism where here's an article promoting a bull run forever, and the perfectly balanced counter-argument that things will turn south. No, the more I look into it, the more it seems like the evidence is on the side of the bear callers:

...
[2]Blue sky. I want to Solve The Problem. If we cut the debt in half or more by the end of 30 years, without destroying the safety net, I'd consider that success.
... Working people of modest means could use support- that's who Trump promised to help during his campaign, and that is the evil irony of the GOP today, to convince people they are the ones to help them and then completely screw them over in favor of the billionaire class. So yes,
...
[3] I don't want to cut it at all, but something has to give. Also, I think a plan that relies entirely on raising taxes without cutting any spending would be seen as in bad faith by "the other side" and would make it harder to achieve. We're talking about raising an addition $1 trillion a year in taxes in this case. All government revenues currently amount to about 30.7% of GDP right now, so it is do-able but would come as a big shock. And contemporary history shows that American politics is not very good at agreeing to such "take your medicine" solutions- it would take an awful lot of stoicism to stick with that plan long enough for the benefits to appear. Any real solution will be like that though. Just my opinion, what do you think?
I won't respond to all of your interesting and intelligent post but will address the three points I've taken the liberty of numbering.

[1] I certainly do agree that the "game is being rigged" to favor the super-rich, but I don't see the rich getting richer off of high treasury yields. Trump wants low interest rates. The Fed will raise short-term rates only as needed to fight inflation. The possibility of high long-term UST or AAA interest rates may lead to an interesting discussion, but in all cases supply-demand rules the day: Bond prices fall (yields rise) because people do NOT see them as a good investment.

The article you link to may agree that bonds will perform as well as stocks in the middle term, but that's not the same as saying USTs will be highly profitable. Your link mentions "Van Hoisington [was rewarded in 2007-2008 when] long-term U.S. Treasury market [rose] by nearly +60%" but UST prices rise because yields fall.

[2] So you agree that employer-paid payroll taxes should be reduced and the revenue recovered by carbon tax? I think it's a good idea too!

[3] One correct point you argue is that it is very difficult, both economically and politically, to raise taxes after they've been lowered. (Similarly the best remedy for opioid addiction is to not get addicted in the first place.) It is because of that difficulty that the stupid tax cuts will have long-term insidious destructive effects. The giant $20 Trillion debt is not going away overnight; all we can hope for is to gradually slow the fall into the abyss. The debt will get to $30 T and perhaps worse. (At this point the future is racing toward financial collapse or social dystopia or both. Smart money may be betting on both.)

And what are you going to cut? Sure, give SocSec a 10% haircut if that's so dear to your heart. I don't like means-testing it, but that may be the least of evils if the opposition insists on some big cuts.

But what about the military: should it get a haircut also? The USA spends almost as much on its military as the entire rest of the world added together. And, not only is USA #1 in military spending but the #3, #6, #7, #8, #9, #10, #12, #13, #14, #15 and #16 countries are all staunch U.S. allies. Each F-22 cost $340 million. How many hip replacement surgeries can be performed for $340 million?

Finally, and especially important, you've drunk the GOP Kool-Aid if you think 30% of the economy spent by government is outrageously high. Please remember, again, that most of the bureaucrats and regulatories are "rounding errors." Other than military (and support for veterans) and debt interest the "huge" government spending is spent on educating, and providing medical care and pensions for many millions of Americans.

Here are some comparative figures from two countries which do not have the huge military budget of the U.S.: 44% of the German economy is government, down from a high of 54% in 1995. 41% of U.K. economy is government down from 51% in 1981. The idea that U.S. government "social spending" is too high deserves its own Pit thread.
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Last edited by septimus; 09-21-2018 at 03:14 PM.
  #179  
Old 09-21-2018, 03:28 PM
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... The article you link to may agree that bonds will perform as well as stocks in the middle term ...
Rereading this, I see that it might be construed as a recommendation to buy bonds. No; in fact I sold some bonds the other day and put the proceeds into gold.

(If you enjoyed this investment advice please Paypal me 30¢. That will include 30¢ for the Paypal service charge; the rest is a fair value for any advice.)
  #180  
Old 09-21-2018, 04:15 PM
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But what about the military: should it get a haircut also? The USA spends almost as much on its military as the entire rest of the world added together. And, not only is USA #1 in military spending but the #3, #6, #7, #8, #9, #10, #12, #13, #14, #15 and #16 countries are all staunch U.S. allies. Each F-22 cost $340 million. How many hip replacement surgeries can be performed for $340 million?

Well yeah, but do free hip replacements show exactly how big your national dick is ? I think not.
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  #181  
Old 09-22-2018, 02:36 PM
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Finally, and especially important, you've drunk the GOP Kool-Aid if you think 30% of the economy spent by government is outrageously high. Please remember, again, that most of the bureaucrats and regulatories are "rounding errors." Other than military (and support for veterans) and debt interest the "huge" government spending is spent on educating, and providing medical care and pensions for many millions of Americans.
Were I to implement a poll test before allowing people to vote, one of the questions would be:

Government Spending is:

A. A waste.

B. A significant contributor to the economy.
  #182  
Old 09-22-2018, 03:14 PM
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Now mind you, imagine the fix SS would have been if the Republicans had their way in the late 1990s and had SS invest the surplus in the stock market.
Depending on the time period - in general the market way out-performs the ROI on SS.

Quote:
Originally Posted by manson1972
I don't understand this. If I was a new doctor, and I only saw Medicare patients, I wouldn't make any money?
Quote:
About three-fourths of short-term acute-care hospitals lost money treating Medicare patients in 2016, according to the Medicare Payment Advisory Commission (MedPAC), an independent agency established to advise the U.S. Congress on issues affecting the Medicare program.
Cite. Something to keep in mind in light of the recent idea of "Medicare for all".

Regards,
Shodan
  #183  
Old 09-23-2018, 09:53 PM
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[1] I certainly do agree that the "game is being rigged" to favor the super-rich, but I don't see the rich getting richer off of high treasury yields. Trump wants low interest rates. The Fed will raise short-term rates only as needed to fight inflation. The possibility of high long-term UST or AAA interest rates may lead to an interesting discussion, but in all cases supply-demand rules the day: Bond prices fall (yields rise) because people do NOT see them as a good investment.

The article you link to may agree that bonds will perform as well as stocks in the middle term, but that's not the same as saying USTs will be highly profitable. Your link mentions "Van Hoisington [was rewarded in 2007-2008 when] long-term U.S. Treasury market [rose] by nearly +60%" but UST prices rise because yields fall.
I think that in the supply-demand equation, the US govt issuing another $10 trillion in bonds in less than a decade will drive up yields. What would it take for the Fed to stop raising rates under these circumstances? Look back to the Bush-Clinton surplus years. Getting the Fed to lower rates was the motivation for Bush's electorally disastrous decision to raise taxes. Trump isn't repeating that "mistake".

And the way I am envisioning the uber-wealthy taking advantage of this is not in the mold of Van Hoisington, but by straight-up buying the bonds. "A 5% yield or just stay invested in a 10-year bear stock market?" they'll ask themselves. "I'll take the 5%." That may be naiive, and maybe if I could think like a billionaire I would be one, but it still makes a big pile of obvious sense to me.
Quote:
[2] So you agree that employer-paid payroll taxes should be reduced and the revenue recovered by carbon tax? I think it's a good idea too!
I'd have to see the details, but yeah, I think Jobs, Jobs, Jobs! is a good goal when it is sincere and not just a rhetorical device.
Quote:
[3] One correct point you argue is that it is very difficult, both economically and politically, to raise taxes after they've been lowered. (Similarly the best remedy for opioid addiction is to not get addicted in the first place.) It is because of that difficulty that the stupid tax cuts will have long-term insidious destructive effects. The giant $20 Trillion debt is not going away overnight; all we can hope for is to gradually slow the fall into the abyss. The debt will get to $30 T and perhaps worse. (At this point the future is racing toward financial collapse or social dystopia or both. Smart money may be betting on both.)

And what are you going to cut? Sure, give SocSec a 10% haircut if that's so dear to your heart. I don't like means-testing it, but that may be the least of evils if the opposition insists on some big cuts.

But what about the military: should it get a haircut also? The USA spends almost as much on its military as the entire rest of the world added together. And, not only is USA #1 in military spending but the #3, #6, #7, #8, #9, #10, #12, #13, #14, #15 and #16 countries are all staunch U.S. allies. Each F-22 cost $340 million. How many hip replacement surgeries can be performed for $340 million?

Finally, and especially important, you've drunk the GOP Kool-Aid if you think 30% of the economy spent by government is outrageously high. Please remember, again, that most of the bureaucrats and regulatories are "rounding errors." Other than military (and support for veterans) and debt interest the "huge" government spending is spent on educating, and providing medical care and pensions for many millions of Americans.

Here are some comparative figures from two countries which do not have the huge military budget of the U.S.: 44% of the German economy is government, down from a high of 54% in 1995. 41% of U.K. economy is government down from 51% in 1981. The idea that U.S. government "social spending" is too high deserves its own Pit thread.
I want to treat SS in a sympathetic way that preserves the program. Some cuts may be required, especially in the context of a... grand bargain? big deal? that the Dems won't just have to make with the Pubs, but also with themselves and the public.

I'd like to cut the military by 25%. It really seems like we can defend our borders, pick off terrorists and be prepared for a hypothetical war at that (still huge) level. Not sure what the full consequences of this are, though. Close a fighter factory and you have cut jobs. Less bombs = less demand for materials and labor. Where are these people going to go? Does this 25% cut help them somehow?

And, it's not that I think 30% of GNP is an outrageously high level, but that a true revenue-sider will face an uphill battle selling $1 trillion/year in tax increases. Be my guest in patiently explaining to the FOX crowd how 35% is still way lower than in Germany or France. If we try to make a deal that the most people can believe is fair while still actually solving the problem, we oughta cut SS, Medicare on the cost/negotiation side, and the military. Do the rest with revenue, and then shamelessly trumpet the fact that you 'cut government spending' like you are some kind of orange carnival barker.
  #184  
Old 09-24-2018, 12:50 AM
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Snowboarder Bo Snowboarder Bo is offline
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On average, doctors and health care providers lose money treating Medicare patients. About 35% IIRC.
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Originally Posted by Snowboarder Bo View Post
Cite, please?
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Originally Posted by manson1972 View Post
I don't understand this. If I was a new doctor, and I only saw Medicare patients, I wouldn't make any money?
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Originally Posted by Shodan View Post
Quote:
About three-fourths of short-term acute-care hospitals lost money treating Medicare patients in 2016, according to the Medicare Payment Advisory Commission (MedPAC), an independent agency established to advise the U.S. Congress on issues affecting the Medicare program.
Cite. Something to keep in mind in light of the recent idea of "Medicare for all".

Regards,
Shodan
Did you have a cite that backed up your assertion, or are you moving your own goalposts?
  #185  
Old 09-24-2018, 04:36 AM
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And the way I am envisioning the uber-wealthy taking advantage of this is not in the mold of Van Hoisington, but by straight-up buying the bonds. "A 5% yield or just stay invested in a 10-year bear stock market?" they'll ask themselves. "I'll take the 5%." That may be naiive, and maybe if I could think like a billionaire I would be one, but it still makes a big pile of obvious sense to me.
Predicting interest rates, inflation rates and dollar strength ten years from now would be an interesting topic and I tried to start such a thread. I wouldn't be expecting a crystal-ball seer, just for a knowledgeable economist to lay out the plausible scenarios. But all that would be off-topic in this thread.

FWIW, your argument makes little sense to me. If bonds are a good investment for billionaires then they are ALSO a good investment for
(a) little guys like you and me. (Obviously our 5% will end up much smaller in absolute terms than the billionaires' 5% but that's true for any investment.)
(b) big guys like foreign banks, who will then bid down the interest rate. (Your scenario seems to involve billionaires knowing bonds are better than stocks, but others not making the same deduction.)

Ignoring 1981-1990, when high interest rates were due to on-going inflation fears, there have been only seven Septembers since 1954 when the real rate (interest minus inflation) on ten-year Treasuries exceeded 3.5%. Four of these 7 came during the booming 1990's: low demand for bonds was due to booming stocks. The other three Septembers with 10-year UST yielding more than 3.5% real:
  • 2009 — DE-flation was 1.3% and QE wasn't yet in full swing.
  • 1955, 1959 — isolated episodes. I'll let experts comment.

TL;DR - Our corrupt government has far simpler ways to enrich billionaires than to badmouth its own debt!
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  #186  
Old 09-24-2018, 04:05 PM
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"counter to all economic wisdom" seems like an overly-broad claim. If I can find an economist that disagrees, would you be willing to retract this claim?
If you ever came up with that economist I missed it. It's been a week; do you need more time?

I have been trying to help. Here are some of the top Google hits; 3 or 4 of the economists have Nobel Prizes; one comes from FoxNews:
https://www.youtube.com/watch?v=m0yS57R6c8s
https://www.youtube.com/watch?v=k3sAfBNiGYo
https://www.youtube.com/watch?v=ENR9_562qIM
https://www.youtube.com/watch?v=huilZjeSI9c
https://www.youtube.com/watch?v=lzigzEAu3z8
https://www.youtube.com/watch?v=_aHWz5DFpfM
Can you find one you like here, or should I keep looking for you?
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  #187  
Old 09-24-2018, 10:57 PM
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FWIW, your argument makes little sense to me. If bonds are a good investment for billionaires then they are ALSO a good investment for
(a) little guys like you and me. (Obviously our 5% will end up much smaller in absolute terms than the billionaires' 5% but that's true for any investment.)
(b) big guys like foreign banks, who will then bid down the interest rate. (Your scenario seems to involve billionaires knowing bonds are better than stocks, but others not making the same deduction.)

Ignoring 1981-1990, when high interest rates were due to on-going inflation fears, there have been only seven Septembers since 1954 when the real rate (interest minus inflation) on ten-year Treasuries exceeded 3.5%. Four of these 7 came during the booming 1990's: low demand for bonds was due to booming stocks. The other three Septembers with 10-year UST yielding more than 3.5% real:
  • 2009 — DE-flation was 1.3% and QE wasn't yet in full swing.
  • 1955, 1959 — isolated episodes. I'll let experts comment.

TL;DR - Our corrupt government has far simpler ways to enrich billionaires than to badmouth its own debt!
Well, my reasoning is pretty simple. It isn't inflation fears particularly that I expect to drive up yields. I don't think it will be people turning away from bonds either- I expect them to get more popular. It is the simple fact that the plan is to issue so damn many of them.

We've just cut taxes for the wealthy by about $200 billion a year. They did not live up to the moronic prediction that they would pay for themselves, they are being paid for with borrowing. And, spending has increased as well, also paid for with borrowing.

We're on a track to issue about $10 trillion worth of bonds over the next decade, probably more. It is quite an acceleration. Even if people think they are a good investment, it seems like this massive supply will outstrip demand and drive up yields anyway.

My opposition to the tax cuts won't change if I turn out to be wrong about future bond yields, but that aspect of things just bugs me every time I think about it, this massive publicly funded income stream for the super wealthy. I don't think you've addressed this theory of bond yields directly- I'd be interested in why you (probably) think things won't play out this way. Do you think the market can readily soak up another $10 trillion in bonds?
  #188  
Old 09-25-2018, 12:41 AM
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There is a threshold where money stops being for survival/comfort and starts being about power. Hence, shifting more of it to the already wealthy becomes not a question of making their lives better but of allowing them to accrue more power over others. This is problematic because it seems fairly common that a person who manipulates large amounts of money tends toward sociopathy. Hence, many of the very wealthy who have control of society are visiting their disease upon all of us. This is not a net positive, and reducing their social obligation just makes everything worse.
  #189  
Old 09-25-2018, 01:13 AM
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A cap on annual income might be helpful. Something like, "Nobody is allowed to earn more than $100 million a year, and if you do, the extra money must simply go to Uncle Sam."


The only issue with that is that private entrepreneurs might not be able to start up ventures entirely out of their own pocket, if, say, they wanted to start up a billion-dollar venture.
  #190  
Old 09-25-2018, 04:00 AM
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Originally Posted by eschereal View Post
There is a threshold where money stops being for survival/comfort and starts being about power. Hence, shifting more of it to the already wealthy becomes not a question of making their lives better but of allowing them to accrue more power over others. This is problematic because it seems fairly common that a person who manipulates large amounts of money tends toward sociopathy. Hence, many of the very wealthy who have control of society are visiting their disease upon all of us. This is not a net positive, and reducing their social obligation just makes everything worse.
This is an over-generalization. Many good performers enjoy performing well, and enjoy being compensated for it. This is true of performing artists like Beyoncé or Springsteen, and also of high-performing investment managers like Buffett or Soros. Although I picked these four examples for their fame, all four are noted for philanthropic giving.

But I do not want to over-generalize in the opposite direction! The super-rich also include Martin Shkreli, Charles Koch and David Koch. Many acquire their wealth through unproductive means or even fraud; some even sent to prison, e.g. Charles Kushner or Bernie Madoff. Simply put there are both good and bad people throughout the income spectrum. And obviously there's some tendency for a businessman motivated by carnal greed to outperform a businessman with humane instincts.

Inequality of income and wealth is a major problem for several reasons — this has been discussed before. Rational thinkers do not seek sudden confiscation of wealth, but they want to see policies that point in the correct direction. An extra $100,000 is a big deal for a working man. An extra $1,000,000 is chump change for the super-rich. In 2017, the heirs of a married couple with a $22 million estate would have to pay a $4 million estate tax — is that so onerous? Remember that the estate may contain unrealized capital gains that were never taxed to begin with. In 2019 the estate tax on that same $22 million estate is .... Zero.

The way Republican voters have been gulled to vote for increases in wealth and income inequality in the U.S. is without precedent. When I first visited Thailand in the 1980's I was stunned by the income inequality. But I watched Thailand's GINI coefficient decline over the next decades due to active government programs like rural electrification, road building, rising minimum wages, and public-financed hospitals. Over the same period, the U.S. GINI rose sharply and is now significantly higher than Thailand's GINI! Among developed countries, only Israel and Saudi Arabia have GINIs as high as the U.S. Even Russia's GINI is lower.
  #191  
Old 09-25-2018, 09:11 AM
Ruken Ruken is offline
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I'm not so concerned about other people having more money than me. I'm more concerned about other people not having enough. And various transfer programs do pull people out of poverty.* Those programs cost money, and we all know where the money is. If we borrow it now, that's means more of it has to go to debt service tomorrow.


*https://doi.org/10.7916/D8RN3853
  #192  
Old 09-25-2018, 09:19 AM
Shodan Shodan is offline
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Originally Posted by Ruken View Post
Those programs cost money, and we all know where the money is.
Yes, it's in the middle class.

Regards,
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  #193  
Old 09-25-2018, 11:15 AM
Ruken Ruken is offline
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Originally Posted by Shodan View Post
Yes, it's in the middle class.
And I can certainly afford higher taxes. Although it depends how you cut "middle". Median household income last year was about $59k. Twice that is $118k, just shy of the 80th percentile. And the top quintile pulls in 51% of household income. Doubtless you could fiddle with the numbers to push the line around. But if we use my arbitrary range, most of the money is not in the middle. And if we looked at money in excess of the poverty threshold, that just pushes more of it to the top.
  #194  
Old 09-25-2018, 12:55 PM
Shodan Shodan is offline
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Sure, you can swap the numbers around. My point was that the rich do not consist of this large, untapped source of money for new programs or expansion of old ones. There aren't enough rich, they already pay the lion's share of taxes.
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Originally Posted by Ruken
And I can certainly afford higher taxes.
I suppose, so could I, for various definitions of "higher". But there is no realistic possibility that we could reduce the deficit without raising taxes on the non-rich, reducing spending on the non-rich, simply by raising taxes on the rich.

Regards,
Shodan
  #195  
Old 09-25-2018, 05:13 PM
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Akaj Akaj is offline
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Originally Posted by septimus View Post
In 2017, the heirs of a married couple with a $22 million estate would have to pay a $4 million estate tax — is that so onerous? Remember that the estate may contain unrealized capital gains that were never taxed to begin with. In 2019 the estate tax on that same $22 million estate is .... Zero.

The way Republican voters have been gulled to vote for increases in wealth and income inequality in the U.S. is without precedent.
Two words: Death Tax.

Whatever GOP strategist came up with this phrase is a genius. GOP voters complain about "elites," they complain about their wages stagnating while the rich get richer, and then they vote for people who abolish the estate tax so the elite rich can keep even more of their money.

Why? Because the phrase "death tax" makes it sound like Hillary and Obama are going to crash their funerals and extract money from their grieving families.

Fucking genius.
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  #196  
Old 09-25-2018, 06:38 PM
leahcim leahcim is offline
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Whatever GOP strategist came up with this phrase is a genius. GOP voters complain about "elites," they complain about their wages stagnating while the rich get richer, and then they vote for people who abolish the estate tax so the elite rich can keep even more of their money.
But I was told that these people were all poor family farmers who would have to sell their homestead to pay the tax (because the land they had farmed for generations just happened to be formally high in value)!

I'm sure that 99% of estate tax payers were like that, and wealthy scions of investment bankers are the exception.
  #197  
Old 09-25-2018, 08:40 PM
ElvisL1ves ElvisL1ves is offline
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Two words: Death Tax.

Whatever GOP strategist came up with this phrase is a genius.
That was Frank Luntz, a pollster and focus grouper whose name comes up all the time in these things.
  #198  
Old 09-26-2018, 10:07 AM
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That was Frank Luntz, a pollster and focus grouper whose name comes up all the time in these things.
Did he come up with "pro-life" and "right to work" too? It's depressing how the right seems to regularly come up with these 2-3-word terms that the left seems incapable of countering in less than a paragraph.
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Old 09-26-2018, 10:28 AM
RTFirefly RTFirefly is offline
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Originally Posted by HurricaneDitka View Post
That's not what RTFirefly said:
Just to make sure nobody gets the wrong impression, what I said was:
Quote:
state income taxes are ... less regressive than state sales taxes.
  #200  
Old 09-26-2018, 12:08 PM
Ruken Ruken is offline
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Originally Posted by Shodan View Post
I suppose, so could I, for various definitions of "higher". But there is no realistic possibility that we could reduce the deficit without raising taxes on the non-rich, reducing spending on the non-rich, simply by raising taxes on the rich.
In case people want numbers, there's a crude analysis here: http://www.crfb.org/blogs/can-we-fix...-top-1-percent
It's with old deficits and old brackets, it assumes no changes to corporate, inheritance, or capital gains taxes, and it assumes no behavioral changes. But it gets the point across.

I've learned over the past couple years that what I consider "realistic" doesn't always match reality, but the third scenario in the table is closest to what I have in mind and I agree and wouldn't call it realistic.

That's if we keep the same bracket structure. The top quintile does pull in about $8 trillion per year and pays an effective tax rate (including payroll taxes) of about 25%. Increasing the effective rate to ~32% would balance the budget. But the devil is in how you do it. And the top 1% already pays that rate if internet randos are to be believed: https://www.taxpolicycenter.org/taxv...ry-progressive
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