crescent22

> Raising taxes on those 5% making $250k a year- say $5k- will have zero impact on them or anyone else.

I don't think people making 350k who lose 5,000 think it will have zero impact. Ask sallyawp.

If I made 350k and my taxes went up 5,000, I'd cut my charity giving by that amount. Let the bleeding heart liberals running charities who all love Obama anyway fund this outrageously unfair tax cut.

crescent22

> If this is true, then Obama will immediately repeal the Bush tax cuts

Well it isn't true. Starbright doesn't understand economics. You raise taxes on anyone, there is a hit to GDP as those people contribute less to the economy.

DocT

Since I'll wager he won't repeal the Bush tax cut but may let it expire, not only isn't it true, Obama also doesn't believe its true.

crescent22

> How does the OP think having the govt force banks to renegotiate owed principle on a lesser amount that the original principle will be good for the economy in its current situation?

The economy is so bad now- it's gone well beyond housing; solving this problem won't help the whole situation. Sure it loosens some incremental spending for the borrower but it requires the mortgage lender to take a definitive writeoff- they would probably rather extend the same mortgage out a few years instead- keep the principal the same.

The economy needs stimulus; incentive for business owners and participants in the economy to take a chance - now everyone is reducing inventories, stopping spending on anything discretionary, taking no chances.

kluge

As B.F. Skinner eventually realized: "The rat is always right." Right wing economic theory (dogma?) holds that lowering tax rates results in higher government revenues, by increasing economic growth. Unfortunately, it doesn't work. If tax rates have any effect at all on economic growth rates, it's so small that you can't detect it against the background of the things which actually do affect growth - demographic changes, energy costs, etc. Every economist actually involved in projecting revenue from tax changes knows that. All of the actual data - the "rats" - shows that. Only the foot soldiers are fed that nonsense anymore. Lowering tax rates doesn't increase government revenues just like eating candy instead of vegetables doesn't make you grow big and strong. There's no "magic wand" and no free lunch.

crescent22

He's already backed off on a bunch of things and the election hasn't come yet:

* Promising to run a publicly-financed campaign

* Getting out of Iraq immediately- notice he's not talking about this anymore? It's turned into, "well of course I'll listen to the commanders"

* An extra 2-4% payroll tax on >250k being deferred out 10 years - wasn't so well received - even worse now- this plan if ever enacted will ensnare some of the very people now in the middle class foaming at the mouth to vote for him.

* Capital gains to 25%... oops make that 20%.

crescent22

> If tax rates have any effect at all on economic growth rates, it's so small that you can't detect it against the background of the things which actually do affect growth - demographic changes, energy costs, etc. Every economist actually involved in projecting revenue from tax changes knows that.

Says you. Which economist has the crystal ball to declare demographic changes the causation of economic growth but not taxes?

DocT

kluge: If what you say is true than I'll lose my wager since Obama will repeal Bush's tax cuts

crescent22

> Your argument is that lowering tax rates ends up giving the government more money than otherwise.

> That is in dispute.

It's a two-step process via GDP, but I absolutely believe it.

dstark

Crescent22, we had the Bush tax cuts. We had deficit spending. Trillions of dollars of debt was added to the federal government balance sheet during the last 8 years. The private sector also borrowed money at incredible amounts.So we had plenty of stimulus during the last 8 years.

And this is what we got....

"The economy is so bad now- it's gone well beyond housing;"

So maybe, tax cuts, deficit spending, and a large debt build up in the private and public sector doesn't lead to economic prosperity.

DocT

dstark: What you say may be true but unless Obama repeals Bush's tax cuts he doesn't believe it.

mapesy

crescent: Studies by the Tax Policy Center support the assertions by dstark and kluge that tax cuts don't necessarily lead to increased economic growth and may, in fact, cut GDP growth over the long term:

Bush Tax Cuts

DocT

You guys can say all you want but the bottom line is neither candidate believes it.

Hunt

I think that is more an issue of character than one of economics. Most people earning $350,000 are not thinking much about where the last $5,000 goes. For many of them, it goes into investments of one kind or another, and not into consumption. It is a very different story for the last $500 of somebody earning $50,000.

PrimetimeMom

We make significantly more than 250k per year and my Republican husband and I will be voting for Obama and gladly paying our share of taxes to help our country. Country First! Right? We all need to make sacrifices after the last horrible eight years and we will do our part. I do NOT want our grandchildren to be paying for this mess. I would rather pay for it now.