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Thread: Sirius Thread Month of AUGUST 2010

  1. #101
    Havakasha is offline
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    John I know one thing for sure and that is you still havent answered my 2 simple questions, but you sure are damn quick when it comes to slinging immature insults. You can run John but you cant hide.

    P.S. i know all about the laffer curve you wanker. Its old news.

    Are you really that blind that you dont know i can provide counter examples where the upper tax rates WERE much higher (and they didnt follow no discredited laffer curve) under Democratic and Republican administrations and the economy grew quite strongly. Please stop acting like you have a monoply on truth when it comes to economic theory. You are a rightwing ideoloque who sees everything through only one prism. You say your the only one that has "common sense" and "logic"?
    Give me a goddamn break!
    Last edited by Havakasha; 09-01-2010 at 10:14 AM.

  2. #102
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    Since John has a penchant for mispelling things i got to thinking that maybe he was actually referring to the LAUGHTER CURVE. You know the one Bush employed to raise the debt and leave our economy in shambles by 2008.

    Virtually every economics Ph.D. who has worked in the Bush Administration acknowledges that the tax cuts of the past six years haven't paid for themselves.

    If there's one thing that Republican politicians agree on, it's that slashing taxes brings the government more money. "You cut taxes, and the tax revenues increase," President Bush said in a speech last year. Keeping taxes low, Vice President Dick Cheney explained in a recent interview, "does produce more revenue for the Federal Government." Presidential candidate John McCain declared in March that "tax cuts ... as we all know, increase revenues." His rival Rudy Giuliani couldn't agree more. "I know that reducing taxes produces more revenues," he intones in a new TV ad.
    If there's one thing that economists agree on, it's that these claims are false. We're not talking just ivory-tower lefties. Virtually every economics Ph.D. who has worked in a prominent role in the Bush Administration acknowledges that the tax cuts enacted during the past six years have not paid for themselves--and were never intended to. Harvard professor Greg Mankiw, chairman of Bush's Council of Economic Advisers from 2003 to 2005, even devotes a section of his best-selling economics textbook to debunking the claim that tax cuts increase revenues.
    The yawning chasm between Republican rhetoric on taxes and even informed conservative opinion is maddening to those of wonkish bent. Pointing it out has become an opinion-column staple. But none of these screeds seem to have altered the political debate. So rather than write yet another, I decided to find out what Arthur Laffer thought.
    Laffer is a bona fide economist with a doctorate from Stanford. He's also largely responsible for the Republican belief that tax cuts pay for themselves. Now 67, Laffer runs economic-consulting and money-management firms in Nashville. About the best I could get out of him on the question of whether the Bush tax cuts have paid for themselves was "I don't know." But that's only part of the story.
    It's a saga that began in a bar near the White House on a December afternoon in 1974. Huddled at a meeting arranged by Wall Street Journal editorial writer Jude Wanniski were Cheney, then the deputy chief of staff to Republican President Gerald Ford, and Laffer, who was teaching at the University of Chicago's business school after a stint in the Nixon White House. In trying to explain to Cheney why a tax hike mooted by the President might not be such a great idea, Laffer drew a chart on a napkin that showed government revenues increasing as the tax rate moved up from 0% but then turning around and heading back toward zero as it neared 100%.
    The idea that high tax rates brought diminishing returns was not controversial or even new--Laffer traces it to 14th century Muslim philosopher Ibn Khaldun. But few economists in the 1970s even considered that real-world tax rates could be on the wrong side of the Laffer Curve. Laffer thought they might be, and Wanniski argued on the Journal's editorial page and elsewhere that they almost certainly were. The claim became a key plank of Ronald Reagan's successful 1980 campaign for President.
    And how did things work out? Laffer is convinced that the reduction of the top tax rate from 70% to 28% during the Reagan years paid for itself--in part by encouraging the rich to stop finagling--and the evidence mostly backs him up. "You find these enormous responses in the upper brackets," Laffer says. "These guys fire their lawyers and accountants and actually pay their taxes. Yay! Isn't that what we want them to do?"
    But Reagan's tax cuts for the nonrich were big money losers, and it took the fiscal discipline of Bill Clinton to mop up the resulting red ink. Laffer gushes with praise for Clinton, but he's also a fan of Clinton's successor. "What Clinton did was, he gave Bush the fiscal flexibility to do what was right," Laffer says. In the face of the recession and terrorist attacks of 2001, Bush "needed to stimulate the economy and spend for defense, and Clinton gave him the ability to do that."
    In other words, the Bush tax cuts were meant to create big deficits. But Laffer's O.K. with that. "The Laffer Curve should not be the reason you raise or lower taxes," he says. Perhaps not, but it does make for great campaign promises.


    Read more: http://www.time.com/time/magazine/ar...#ixzz0yF8eTiCy
    Last edited by Havakasha; 09-01-2010 at 12:17 AM.

  3. #103
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    We can go back and forth on economic theory and the laffer curve all day if you want.

    Debunking One of the Worst Ideas in Economics
    by Charles Wheelan, Ph.D.

    Posted on Tuesday, May 2, 2006, 12:00AM
    In this column, I'm focusing on bad economics. In fact, I'm going to write about what I consider to be the two worst economic ideas -- or at least ideas that pass as economics, though both have been thoroughly repudiated by nearly all credible thinkers.

    When I say worst, I don't mean the most outlandish (e.g. stock prices are controlled by aliens) because those ideas usually collapse of their own weight. Rather, the most pernicious bad ideas in economics are those that have a ring of truth. They're hard to debunk because they have a certain intuitive appeal. As a result, they stick around, providing bogus intellectual cover for bad policy, year after year, decade after decade.

    For the sake of political balance, I'll skewer a favorite of the right in this column, and then a favorite of the left in my next piece.

    The Laffer Curve

    Economist Arthur Laffer made a very interesting supposition: If tax rates are high enough, then cutting taxes might actually generate more revenue for the government, or at least pay for themselves. (In one of life's great coincidences, he first sketched a graph of this idea on Dick Cheney's cocktail napkin.) If the government cuts taxes, then Uncle Sam gets a smaller cut of all economic activity -- but reducing taxes also generates new economic activity. Laffer reasoned that, under some circumstances, a tax cut would stimulate so much new economic activity that the government would end up with more in its coffers -- by taking a smaller slice of a much larger pie.

    In fairness to Mr. Laffer, there's nothing wrong with this theory. It's almost certainly true at very high rates of taxation. If you consider the extreme, say a 99 percent marginal tax rate, then the government will probably not be collecting a lot of revenue. To begin with, citizens are going to hide as much income as possible. (The more honest ones will turn to barter and avoid the tax system entirely.) And no one is going to rush out and take a second job or build a factory if they get to keep only $1 of every $100 that they earn.

    So it's entirely plausible that slashing tax rates from 99 percent to 30 percent could increase government tax revenues. It would deflate the black market and provide a huge new incentive to work and invest.

    No Big Jolt for the U.S.

    But here's the problem when we take Laffer's theory and try to apply it in the U.S.: We don't have a 99 percent marginal tax rate. Or 70 percent. Or even 50 percent. We start with low marginal tax rates relative to the rest of the developed world. (Yes, I understand that it may not feel that way after the check you wrote last month.)

    So cutting the tax rate from 36 percent to 33 percent is not going to give you the same kind of economic jolt as slashing a tax rate from 90 percent to 50 percent. There's no huge black market to be shut down, no big supply of skilled workers to be lured back into the labor market, and so on.

    Will it generate new economic activity? Probably. And that will generate some incremental tax revenue for the government. But remember, it also means that the government will be taking a smaller cut of all the economic activity that we already have.
    Think about a simple numerical example: Assume you've got a $10 trillion economy and an average tax rate of 30 percent. So the government takes $3 trillion.

    Let's cut the average tax rate to 25 percent and, for the sake of example, assume that it generates $1 trillion in new economic growth (a Herculean assumption, by the way). So now, what does Uncle Sam get? One quarter of $11 trillion is only $2.75 trillion. The economy grows, government revenues shrink.

    That's basically what happened with the large Reagan and George W. Bush tax cuts, both of which were followed by large budget deficits. Yes, spending has a lot to do with that, but the bottom line is unequivocal: In both cases, government revenue was lower than it would have been without the tax cuts.

    Can't Lose Weight by Eating More

    Neither the Reagan nor the George W. Bush tax cuts were "self-financing," as the Laffer disciples like to argue. According to The Economist -- my former employer and no bastion of left-wing thought -- the current Bush Administration's top economist, Gregory Mankiw, estimated that decreasing taxes on labor would generate enough growth to recoup only about 17 cents for each lost dollar; a tax cut on capital is better, paying for more than half of itself. Still, the bottom line from the Bush Administration itself is that tax cuts reduce Uncle Sam's take.

    So why does Laffer's sketch on Dick Cheney's cocktail napkin rank near the top of my list of bad economic ideas? Because, when applied to the U.S., it's intellectually dishonest. The Laffer Curve offers the false promise that we can cut taxes without making any sacrifice on the spending side, and that's simply not true. It's the economic equivalent of arguing that you can lose weight by eating more.

    Let me be perfectly clear: I'm not arguing that tax cuts are bad. I'm simply pointing out that we can't pretend that tax cuts won't require reductions on the spending side to balance the budget. In fact, you can disregard every other argument in this column and think about one thing: If Laffer were right, lower taxes would never require any spending sacrifice. We could pay a mere one percent of our income in taxes and still fund all of our government spending -- and maybe more! Do you think that's really possible?

    This column should give you a hint of why economics is called the dismal science -- it's all about tradeoffs. We're the ones telling you that if you get more of something, you probably have to get less of something else.

    Whether it's tax policy or dieting, you can't have your cake and lose weight, too, which is why America currently has huge deficits and a lot of fat people.

  4. #104
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    John there is plenty more to debunk the laffer curve but dont you think we should return the Siri XM stock thread to the people who want to discuss siri?
    I have asked you numerous times to post your political ideas in the P O L I T I C S thread but for some weird reason you seem resistant.

    Failing to Pass the Laffer Test
    OK, a followup on my previous tax revenue post.

    The revenue boom of the last few years, which mainly depended on booming corporate profits, is over. Here’s a chart from the Congressional Budget Office:

    And a further slowdown is visible within the fiscal 2007 data: revenue in September was up only 2 percent from the previous year.

    To put this in perspective, here’s revenue as a percent of GDP since Clinton took office:


    So everything you’ve heard about how revenues have boomed since the Bush tax cuts is wrong. What really happened was that revenue plunged, as a percent of GDP, in the early Bush years, then staged a partial, but only partial, recovery. And that recovery seems to have run its course.

    UPDATE: Aha, I forgot to point out that GDP growth has not been exceptionally strong under Bush, so that I’m not cheating by looking at revenues as a percent of GDP. Check out Figure 2 here.

    Yet on the basis of this experience, both Bush and his would-be Republican successors are proclaiming that tax cuts actually increase revenue.

  5. #105
    SiriuslyLong is offline
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    "Can't Lose Weight by Eating More"

    Wrong again Havakasha. You can starve to death from eating as much celery as you can. Secondly, did you ever hear of the Atkins diet? It is a qualitative diet. You can literally eat as much protein and fat as you wish, and you will lose weight.

    This is just another example of Havakasha not being thorough as always lol

  6. #106
    SiriuslyLong is offline
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    And hey, how about those jobs created in August LOL Wait, what's that sound? A trillion dollars going down the toilet? The trillion dollars Obama endeared to my 9 year old daughter? Leave it to the visible hand of government.

  7. #107
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    Quote Originally Posted by SiriuslyLong View Post
    "Can't Lose Weight by Eating More"

    Wrong again Havakasha. You can starve to death from eating as much celery as you can. Secondly, did you ever hear of the Atkins diet? It is a qualitative diet. You can literally eat as much protein and fat as you wish, and you will lose weight.

    This is just another example of Havakasha not being thorough as always lol
    Damn, but john promised the world you could never lose weight by eating more and i believed him. What a dumbass i am. LOL. Good thing though i didnt believe him about Beck, Palin, and global cooling.
    Last edited by Havakasha; 09-01-2010 at 10:52 AM.

  8. #108
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    Quote Originally Posted by SiriuslyLong View Post
    And hey, how about those jobs created in August LOL Wait, what's that sound? A trillion dollars going down the toilet? The trillion dollars Obama endeared to my 9 year old daughter? Leave it to the visible hand of government.
    Now S&L stop being so cheeky. We have been around the block on this and you know what the CBO said now dont you? lol. And why is it you never acknowledge that a huge part of the debt we are in is a carry over from the Bush era? hmm i wonder? Im sorry if you think you can click your heels (aint no wizard of oz) after the U.S. suffered the 2nd worst recession (on top of major structural problems in our economy and a worlds financial system almost in total collapse) in US history and have everything be immediately wonderful again but it dont work that way. This wasnt no normal recession. one might even call it a depression. Look back at the 1930's and see how long it took us to truly recover from the 1st recession/depression. i only wish (not really) we could have seen what McCain/Palin would have done for us. Now that
    would have been something.
    Are you supporting those tax cuts for small business that are being held up by some Senate Republcans? You know the tax cuts they wont even allow to be voted on?

    So how about that Siri stock? This is the Siri xm stock thread isnt it? Did you ever notice how some of the most "Conservative" members of this thread are big into penny stocks. Meanwhile im not in debt, have paid off the mortgage, dont gamble, and dont bet on penny stocks (other than siri that is. ) What do you think we can learn from that?
    Last edited by Havakasha; 09-01-2010 at 10:53 AM.

  9. #109
    SiriuslyLong is offline
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    Quote Originally Posted by Havakasha View Post
    Now S&L stop being so cheeky. We have been around the block on this and you know what the CBO said now dont you? lol. And why is it you never acknowledge that a huge part of the debt we are in is a carry over from the Bush era? hmm i wonder? Im sorry if you think you can click your heels (aint no wizard of oz) after the U.S. suffered the 2nd worst recession (on top of major structural problems in our economy and a worlds financial system almost in total collapse) in US history and have everything be immediately wonderful again but it dont work that way. This wasnt no normal recession. one might even call it a depression. Look back at the 1930's and see how long it tooks us to truly recover from the 1st recession/depression. i only wish (not really) we could have seen what McCain/Palin would have done for us. Now that
    would have been something.
    Are you supporting those tax cuts for small business that are being held up by some Senate Republcans? You know the tax cuts they wont even allow to be voted on?

    So how about that Siri stock? This is the Siri xm stock thread isnt it? Did you ever notice how some of the most "Conservative" members of this thread are big into penny stocks. Meanwhile im not in debt, have paid off the mortgage, dont gamble, and dont bet on penny stocks (other than siri that is. ) What do you think we can learn from that?
    Conservatives and penny stocks? I'm not interested.

    Yes, a huge amount of debt was from Bush. Keep in mind, we were attacked and went to war during his watch.

    Despite the lousy news on jobs, it looks like the market is going green today. Maybe it'll take SIRI with it - after all, it technically should be an "up 3" day.

  10. #110
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    I was just being a little playful about the penny stocks if you didnt sense that.

    You mean we were attacked by Al Qaeda and the govt decided to invade Iraq which had nothing to do with it. A HUGE amount of money has been spent on THAT war (while afghanistan was neglected). Some measure the expenditure at 3 BILLION, others say 1 BILLION. Either way...

    Yeah lets hope Siri heads back up soon.

    So Sept 1, 2010 marks the beginning of the month during which John predicts "carnage" or
    "cliff" diving (cant keep track of his predictions anymore cause there are so many permutations. lol)
    The market is going up and i couldnt be happier.

    Just playing with you john. Remember to try to keep your sense of humor when
    everything you say is proved wrong. LMFAO.

    P.S. Did you ever notice how John ALWAYS talks about the 1st Bush recession when he discusses
    economic theory and NEVER the 2nd Bush recession/depression, which we are currently still enmeshed in? Quite interesting huh? lol.
    Last edited by Havakasha; 09-01-2010 at 10:59 AM.

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