Wow, a Heritage paper from 2001! I love the way how they said that based on tax cuts from the 1960s and 1980s, we could expect the 2001 tax cuts to increase revenue.
Well, in the 60s and the 80s revenue DID increase, though perhaps not as fast as they would have otherwise, who knows. But the 2001 tax cuts caused three straight years of declining revenues. PDF cite. So much for that theory.
Ravenman, I can understand the other two being that idiotic, but not you. Should we laugh at this as well? Hell, it’s from 19-fucking-20. The reason I offered that cite to Askeptic (as you know and as I said) was so he could read introductory material on marginal tax rates and their historical effects. The fact that you’ve joined the chorus and even made a point that the (thoroughly bibliographed) article is — GASP! — six years old has hurt your credibility in this debate as far as I’m concerned (not that you care, but still). You’ve made Carol seem reasonable. And the people supporting you are (or ought to be) an embarrassment to you.
Oh, dear, we seem to have offended Lib’s dignity. Difficult to avoid, it being an object of such massive proportion. But come now: did you really believe that such a citation from a clearly partisan site would be swallowed without demurral? Really and truly, no shit?
It may be, as you put it, “introductory material on marginal tax rates and their historical effects”, entirely free from ideological slant and interpretation. I may be the Queen of Rumania, for that matter. You could have avoided this with the merest acknowledgement, the tiniest shrug of a caveat, and all would be well.
But you didn’t, did you, buckaroo?
An “idiot”, am I? Lib, old chum, you’ll be serving tea to Ayn Rand on a cold day in Hell when you’re smarter than me. Your dignity will recover, it always does after you are hoist on your own retard.
Peace on you.
I’m afraid you may have misunderstood me. I wasn’t making fun of Heritage – there’s smart people there and they’re a good a cite as any, I’d say, but not immune to criticism. So I certainly wasn’t intending to belittle you for providing that link, even though I disagree with most of its assertions. My exclamation was more line line with, “Wow, we just took a trip in the wayback machine! Let’s take a look at how well their predictions have held up.” And, as I said, I don’t think very well. I’d say I disagree with most of Heritage’s conclusions, but I certainly am not dismissive of them.
For example, this article makes the exact same mistake I referred to in Carol’s grad paper cite. In the seventh paragraph, the author says that Americans don’t want to pay more than a quarter of their income in taxes, and then talks about marginal rates of up to 39%. Well, guess what, Dr. Mitchell, the average tax burden at the time the article was written was about 23% (see my cite in a previous post). What’s more, Dr. Mitchell mistakenly claims in his footnote (#3) that his analysis actually “understates the burden of taxes” borne by Americans, because his reference to tax rates didn’t include other taxes.
What a bunch of crap. The cite I produced includes payroll taxes in its calculation, so in contrast to the article’s implication that federal taxes are even greater than the tax rates he related, the tax burden is demonstrably LOWER than his innuendo.
So that’s another point on why I disagree with the article, but I have no problem at all debating its merits.
Anyway, wasn’t this pitting supposed to be about BG?
I, OTOH, am not as circumspect as Ravenman. He is surely the better man for that, but I can’t help but noticing that, long before we get to the 2001 tax cuts, we run into the sort of bullshit that we routinely chop to bits on this board when a poster presents it.
Take the very first table, “Lower tax rates in the 1920s meant more tax revenue.” Two things strike me about it: (1) the surge of tax revenues in 1927 and 1928 - could that have just possibly been due to all the fortunes people were making in the bubblicious stock market of the late 1920s?
This should have been a familiar issue in 2001, because it was certainly argued at the time that Clinton’s surpluses were at least partly due to the stock market bubble of the late 1990s.
Gotta wonder about that with respect to Table 2 as well.
With Table 3, there’s just a two-year increase in the rate of growth subsequent to lowering the top tax rate from 90% to 70%, then it apparently goes back to what it had been before the Kennedy tax cut. Maybe there’s more there, but I don’t see it.
In the text, they say that inflation-adjusted tax revenues increased by 1/3 from 1961 to 1968. AFAICT, they’re actually understating their case - in the (warning: big-ass PDF) U.S. Budget Historical Tables, Table 1.3, it shows an increase of 38.3%. Fine, but how does that compare with other 7-year periods in the postwar era? I looked at the other years ending in 1 and 8 as a subsample, since looking at all 50+ periods would be a pain:
1951-58: 17.0%
1961-68: 38.3%
1971-78: 28.2%
1981-88: 14.7%
1991-98: 39.8%
2001-08: 10.4% (projected)
No substantial tax cuts in the odd decades, and substantial tax cuts on the high end in the even decades. And what happens? The odd decades win! 1990s > 1960s, 1970s and 1950s > 1980s and 2000s. My, my.
Maybe it looks better in a comparison amongst all 7-year periods, but they provide no yardstick: just “here’s the tax cut, here’s the rate of increase in tax revenues, ergo.”
Okay, Luc. I shouldn’t have insinuated that you’re an idiot. I apologize for that. But honestly, if you’re going to sling mud, don’t complain when some of it splashes back on you.
Ravenman, I do see your point, but the only subject I was addressing (and what I thought was being discussed at the time) was marginal tax rates — not payroll taxes, sales taxes, and all the other. With respect to the trends not holding in the George W Bush era, there are many reasons for that, not the least of which has been his ungodly pillaging of the national treasury for the sake of enriching a chosen few. A market cannot be both free and Fabianist.
And now, back to the BG pitting I suppose…
Wear it with pride. Lib’s Little Bag of Insults seems to be shrinking, as this has lately been his preferred contumely for anyone who doesn’t swallow his fulminations without comment. I fully expect him to begin spelling it “idjit” any day now.
[…thoughtful nod…]
What I hear you saying is that you believe my bag is shrinking.
[…making notes…]
And how does that make you feel?
Smugly satisfied that the laws of karma are operating.
I’m not sure karma is all that fond of smugness.
**<slight tangent>Lib, I’d be interested in knowing to what you attribute the continuous rise (or deplorable fall of the dollar; depends on how you look at it) of the ‘socialist’ Euro vs the Almighty US dollar.
Not looking for cites ATM, but IIRC, it was about 0.8 to the dollar when his Lowness took over…whereas now it’s roughly 1.5 to same or about 50% + higher. Higher still, if you consider said starting point.
In light of the above what do you think that has to say about both, Bush’s think-tank (allow me a chuckle or two) on economic policies and the Democratic Socialism as practiced in most EU nations?
Obviously, this is not to say that awe-inspiring fortunes haven’t been made during his term (if anyone’s impressed by the rich getting richer that is. I am certainly not) by any number of his – and especially, Chaney’s gang-bangers – cronies.
[qoye]…astly, don’t forget China and the quickly rising India! Seems to me they have you by your economic yarbles even more than your ‘friendly’ EU does. Especially China.
Yes, I know, you’re no fan of Bushes (bad pun purely unintentional), but it seems to me, from what little I understand of your ideology, that under a Libertarian regime, all else being the same, your current precipitous economic downfall would only increase…
Thoughts? And yes, I am well aware you could, if you wanted to, pulverize the world – but others have similar capabilities as you do. Hence I can’t possibly see a winner in all of this. 'cept the ones already mentioned nursing the whole project all-along.
What gives, IYO?
Thanks in advance.
<tanget over/? Don’t ask moi what with the way this thread’s going. Then again, we could talk sports all night long – speaking strictly for myself of course.** Who’s pretty much clueless anyway. Not like it’s our Golben Age of off course…but if you play with fire**
OOh, well. Thanks fo taking the this tine one and
Oh, well. Thanks for taking the time to read this post and I look forward to your response.
~J
Damn Red, how many time have we told you about posting drunk?
I agree with you, but sheesh. 
I hope you realize that economically speaking, a “strong” currency is not necessarily a good thing. (In fact, a growing economy can lead to depreciation of the national currency, because the newly-prosperous citizens are eager to trade off their currency for foreign currencies in order to buy foreign products. This decreases demand for local currency and lowers its relative value). Of course, a strong currency does give one a nice nationalistic feeling, but its economic analysis can actually be quite complicated.
But please, don’t let the facts get in the way of the snark and knee-jerk Bush bashing.
When **Lib ** reads a post:
*blah blah blah blah blah blah ***Lib’s *** blah blah blah *Bag blah blah blah blah blah blah blah
Fetch, Lib. Good dog.
**
You’re right of course. That post was beyond mangled. But, in my defense, I haven’t slept at all for two day due to lack of power. I have a pretty good inverter, which under ‘normal’ conditions will go for ten to twelve hours. Usually that covers my needs…but it’s been lights-out since Sunday at four (PM) till six 2nite. Been a walking Zombie all day. Lack of sleep – and I normally need just four to five hours – just kills me but I had so much crap to do that I had to survive on java for said time frame.
Zombied-out is no way to post. Lesson learned.
Trust my life-long insomnia will give me a break just after this post.
Again, I’m sorry…and I’d fully understand Lib not responding. That is one mutilated post that needs to be put to rest --as do I
Night. Apologies to all once again**
Sleep tight, Red.
P.S.: You might want to down 2 or 3 aspirin before bed though. That’s what I do and it really helps come morning.
Night Red. Or should I say Night Red?
Ronald Reagan understood this too. In response to criticism of a 5% tax reduction in 1981, he wrote:
“You suggest I should cut spending and defer the tax cuts…The tax cuts are essential to get the economy going again just as a somewhat similiar tax reduction by John F. Kennedy in 1963 stimulated the economy providing even higher receipts for government in spite of the reduced rates.”
–Letter to Mr. Irving S. Schloss, New Haven, CT, June 28, 1982
Of course, “getting the economy going again” generally requires a sharp drop in a limited number of key taxes that will spur consumption. It does not require that all taxes be reduced to a level that promotes debt. (This was the complaint of serious economists in the Spring of 2001: instead of cutting taxes in key areas that would promote consumer confidence, Bush’s plan was to set long term reductions in stable taxes that would force the nation into deeper debt, just as we had finally begun to get clear of that burden.)
You appear to be fixated on the notion of misapplying sound bites about one tax or another to an overall analysis of taxes, in general.
Just as your claim that “Taxing the successful, at some point, becomes a disincentive for them to earn more.” was an empty claim that you attempted to support with essays written by people who appeared to not understand the topic about which they were writing, (as demonstrated by Ravenman), a little bit of post hoc, ergo propter hoc fallacy regarding events, and a clearly mistaken claim that anyone was ever actually taxed 91% of their earnings, I am sure that you will provide a bit of “support” for your position that mangles both the words of Kennedy and Reagan and distorts the actual history that followed their proposals–and you will continue to look silly when you do so.