Showing posts with label tax policy. Show all posts
Showing posts with label tax policy. Show all posts

Thursday, February 23, 2017

This week, a bright day in the darkness that is Kansas

Governor Sam Brownback is a teabagger, a right wing radical.  He and his policies have left Kansas in a big smoking crater politically and economically.  It is unlikely he will ever hold public office after his current term expires, because that is the epic scale of his failure.

Brownback, not laughing now
Trickle down economics does not work.  The only thing it does, the only thing it EVER has done, is to be redistributive, taking money from the poor and middle classes and then giving it to the 1%.  It explodes the wealth and income gap enormously.  And it creates massive debt and deficits for the state or nation that enacts it.  Greed, not greatness is the driving motivation.

Image result for arthur laffer
Laffer, not laughing now

Earlier this week, the legislature in Kansas took a GENUINELY bi-partisan approach to governance when it repealed the failed tax policy of Brownback and Laffer.  Brownback promptly vetoed the repeal, and the House side of the Kansas Legislature then overturned the veto with a vote 1 over the required number.  Sadly the Senate, which is much much smaller, tried to do the same, but fell 3 votes short.

So for now the tax policies of Brownback stay, but it is likely there will be another attempt at repeal and it is expected the next try will be successful.  It is sufficient that they nearly succeeded in Kansas, and that they plan to try again.

The architect, so to speak, the designer of disaster, was one Arthur Laffer, who previously advised Ronald Reagan to implement trickle down economics which was a huge failure, is now abandoning the sinking ship that is Brownback and Kansas to promote the same tax policies with Trump's administration.  What Brownback and his Republican legislature put in effect was entirely on party lines, was nearly identical to what Trump is now planning to do with the cooperation of the Republican controlled Congress.

Let me outline some of the outcomes of the Reagan effort, which parallels the much earlier "Horse and Sparrow" debacle of the same tax plan in the 19th century.
"Reagan significantly increased public expenditures, primarily the Department of Defense, which rose (in constant 2000 dollars) from $267.1 billion in 1980 (4.9% of GDP and 22.7% of public expenditure) to $393.1 billion in 1988 (5.8% of GDP and 27.3% of public expenditure); most of those years military spending was about 6% of GDP, exceeding this number in 4 different years. All these numbers had not been seen since the end of U.S. involvement in the Vietnam War in 1973. In 1981, Reagan significantly reduced the maximum tax rate, which affected the highest income earners, and lowered the top marginal tax rate from 70% to 50%; in 1986 he further reduced the rate to 28%. The federal deficit under Reagan peaked at 6% of GDP in 1983, falling to 3.2% of GDP in 1987 and to 3.1% of GDP in his final budget. The inflation-adjusted rate of growth in federal spending fell from 4% under Jimmy Carter to 2.5% under Ronald Reagan; however, federal deficit as percent of GDP was up throughout the Reagan presidency from 2.7% at the end of (and throughout) the Carter administration. As a short-run strategy to reduce inflation and lower nominal interest rates, the U.S. borrowed both domestically and abroad to cover the Federal budget deficits, raising the national debt from $997 billion to $2.85 trillion.This led to the U.S. moving from the world's largest international creditor to the world's largest debtor nation."

So to recap, Reaganomics caused a huge decline in federal revenue, and we became the world's largest debtor nation after being the world's largest creditor nation. The ONLY reason that things improved towards the end of the Reagan administration were the reversals of his tax cuts with ELEVEN tax increases. But NEVER have the 1% returned to an level of paying their fair share. The burden of making up the deficiencies from Reagan forwards has always fallen on those who earn less and have less financial resources than the wealthy, who benefit disproportionately from government.

From CBS News:
Meanwhile, following that initial tax cut, Reagan actually ended up raising taxes - eleven times. That's according to former Republican Sen. Alan Simpson, a longtime Reagan friend who co-chaired President Obama's fiscal commission that last year offered a deficit reduction proposal.
Raising taxes, that is just what they are doing in Kansas, but only after significant harm. And that is what we have to look forward to from Rump and the Republians AGAIN.

Saturday, June 13, 2015

Conservatives MUST GO!

These are factual figures. Conservatives are lousy at governance, and especially poor at economic policy and foreign policy --- and those two are both closely connected to our failed energy policy. To see the actual statistics on how bad these obsessive ideology failures really are, see the graphic below.

Via Occupy Democrats on Facebook:




Conservatives still believe the debunked nonsense promoted by Art Laffer -- who is currently the personal architect of the failed government tax policy in Kansas.  Tax cuts do not increase revenue, increase job growth or increase growth of GDP.

From Fact and Myth:

Do Tax Cuts Increase Revenues? No, Tax cuts do not Increase Revenue
“The Bush tax cuts led to 50 consecutive months of job growth…It’s demonstrably proven that tax cuts increase revenues” – Rush Limbaugh

The argument that tax cuts create or increase revenue is an old myth that simply refuses to go away. The logic behind this argument is that cutting taxes will stimulate spending (since investors now are  now encouraged through reduced tax rates) that will result in GDP growth.  This growth in GDP will result in increased tax revenues so significant that they will more than offset the drop in tax revenues that result from a lowered tax rate. The inverse to this is that increased taxes lower tax revenue by discouraging investment, which in turn lowers tax revenues so drastically, that they offset the added increase coming from the tax rate increase. One of the reasons Republicans and other self-ascribed fiscal conservatives are able to get away with this is, is the superficially plausible argument that the Reagan and/or Bush tax cuts grew the economy and created revenue.  To understand the fallacy of these arguments, it is necessary to understand economic growth during business cycles and over a long period of time, and how this affects tax revenues.

Correlating Tax Increases and Decreases with Revenue

By conveniently pointing to places where tax cuts were enacted at or around the time of a recovery or boom, tax cut advocates argue that tax cuts increase revenue.   The problem with this is that the revenue increases following the Bush and Reagan tax cuts are dwarfed by the revenue increase following Bill Clinton’s tax increase on the wealthiest Americans.  In fact, as a percentage of GDP, post-Reagan & Bush tax cut revenue falls below the 1965-2005 average. In other words, revenue increased because the economy was recovering/growing, and the tax cuts have little (probably nothing) to do with growth in GDP.  if anything, these tax cuts actually lowered revenue increased from what they would have been otherwise.  So the real question to ask is this: how much revenue did these tax cuts cost us?  See Historical Tax Rates.

Half of the right wing are evangelicals.  From CBS news earlier this year:

White Evangelicals are half of GOP primary voters

(CBS News) NEW YORK -- With nominating contests completed in 27 states and nearly 40 percent of Republican National Convention delegates allocated, Republican primary voters are showing a record-breaking religious bent.
So far, 50 percent of Republican primary and caucus voters have been white evangelical, or born again, Christians, based on CBS News polling of voters entering or exiting their polling places since the first contest in January.
The data comes from entrance polls in two caucus states, Iowa and Nevada, and exit polls in 14 primary states - Alabama, Arizona, Florida, Georgia, Massachusetts, Michigan, Mississippi, Nevada, New Hampshire, Ohio, South Carolina, Tennessee, Vermont and Virginia.
"Conservative people of faith are playing a larger role in shaping the contours and affecting the trajectory of the Republican presidential nomination contest than at any time since they began pouring out of the pews and into the precincts in the late 1970's," said Ralph Reed, founder and chairman of the Faith and Freedom Coalition, who called our attention to the numbers today.
Reed said conservative Christian turnout among Republicans exceeds its rate from four years ago, when 44 percent of white Republican primary voters described themselves as evangelical. They're not only a factor in the South but also in general election battleground states like Ohio, where 47 percent of Republican primary voters subscribed to the label this year.
Reed estimated that through the primaries in Alabama and Mississippi this past Tuesday, more than 4 million evangelical Christian voters had participated in those 16 primaries and caucuses where entrance or exit polls were conducted by CBS and other news organizations.
"They are indispensable to any winning strategy for the eventual Republican presidential nominee in both the primaries and the general election. Any candidate who ignores these voters and the values that motivate them does so at their own peril," Reed said.

As a general thing, participation in democracy is a good thing.  But because conservatives have engaged in wholesale voter suppression of any demographic that doesn't vote for their candidates and causes, it actually results in the hijacking of representative government, and the inevitable resulting epic failures of fanatics in control. 

Evangelicals specifically, and conservatives generally, appear to struggle with the basic concepts of cause and effect.  They engage in what amounts to magical thinking as a preference to rational thought, and to embrace religious superstitious insanity in the face of overwhelming logic and data.

It is no accident that American secular democracy arose in the era of the highly secular, pro-science  Age of Enlightenment.  And yet we still see stupidity like this, which has no place in government and which is the last thing our founding fathers and mothers wanted to see empowered or respected. 

It doesn't matter if the willful ignorance is the economic policies of Art Laffer and his stupid curve, or the religious right superstitious insistence on controlling everyone's sex choices because they are a bunch of sexuality hating prudes.  They are bad for America, They have to GO.

From the Huff Po :

State Rep Suggests Abortion Is To Blame For California Drought

Scientists are still exploring the causes of California's historic drought, but one local lawmaker thinks it might all come down to one thing: God's wrath over abortion.
While speaking at the California ProLife Legislative Banquet last week, California Assemblywoman Shannon Grove (R) suggested a theory that the state's worst drought in 1,200 years may be divine retribution for California providing women with access to abortions, RH Reality Check reported.
“Texas was in a long period of drought until Governor Perry signed the fetal pain bill,” she told the audience. “It rained that night. Now God has his hold on California.”
Grove was likely referring to House Bill 2, RH Reality Check noted, a Texas abortion bill banning abortions 20 weeks after fertilization, four weeks earlier than the standard set by Roe v. Wade.
Grove did not immediately respond to a request for confirmation that she made the statement at the event, but she elaborated on her theory in a Facebook comment.
"I believe --and most Americans believe --that God’s hand is in the affairs of man, and certainly was in the formation of this country," she wrote. "Is this drought caused by God? Nobody knows. But biblical history shows a consequence to man’s actions."

Dumb bunny and blond bimbo Shannon Grove is wrong.  The correct understanding of cause and effect is the  scientifically established and totally secular  anthropogenic global warming from fossil fuels and other human activity, OTHER THAN ABORTION OR GAY MARRIAGE AND GAY SEX.  These crazies control the right; the only need we have to take back America is from the ridiculous radical right wing nuts who have demonstrated that they are out of touch with REALITY --- and dangerously so.