And why are they not being called on it by the “journalists” they spew this nonsense to:
Republican Senate Minority Whip John Kyl was hammered by Democrats earlier this week for backing extending the Bush tax cuts for the wealthy – and insisting they need not be paid for.
Now Senate Republican Leader Mitch McConnell (pictured) is backing up Kyl’s position.
“That’s been the majority Republican view for some time,” McConnell told TPMDC. “That there’s no evidence whatsoever that the Bush tax cuts actually diminished revenue. They increased revenue, because of the vibrancy of these tax cuts in the economy. So I think what Senator Kyl was expressing was the view of virtually every Republican on that subject.”
McConnell’s argument is that even though the government would be forgoing hundreds of billions of dollars in revenue by extending the tax cuts on relatively wealthy Americans, that loss will be more than offset by the growth spurred by keeping the money in taxpayers’ pockets. (The Obama administration wants to extend the cuts for Americans making less than $200,000 or $250,000 but let them lapse for those making more than that.)
WTF is he talking about? That just makes no sense whatsoever. None. Zero. One of the main justifications of the tax cuts back in 2001 was that the surplus was too large and we didn’t want the government having to reinvest or have too much money, so we would cut taxes so the government would have less money and give it back to “the people who earned it.” Now McConnell says that despite the fact that there is several trillion dollars less in the government cofferes because of the tax cuts, those tax cuts bring in more revenue. So why did the surplus not increase?
How do they get away with this shit? Any journalist who doesn’t laugh in the face of someone spewing this nonsense should go home, rip up their j-school diploma, and then do the honorable thing.
Tom Hilton
That’s awesome news! In which case, how are we going to spend that enormous budget surplus Bush left us with?
Fwiffo
This has been a standard conservative “truth” for as long as I’ve been alive. Tax cuts always increase revenue. We’re always on the far side of the Laffer curve.
Omnes Omnibus
Well, you know that tax cuts are like Jello, right? There is always room for Jello. And so with tax cuts.
Cathie from Canada
“Then do the honourable thing” — what, go and work for Fox news?
licensed to kill time
__
Has the Vibrating Tax Cut replaced the Invisible Hand in getting GOPers off?
Kirk Spencer
Right. The rich never save, nor do they spend their money outside the US, and therefor everything they get goes directly and immediately to the economy.
The poor, on the other hand, are sponges and every dollar they get disappears, never to be seen again.
Therefor all we need to do to make everything better is give everything to the rich so they starve the poor out of existence.
Reverse Robin Hood for the win.
(/sarcasm)
Midnight Marauder
Fulfill their destiny and become a court reporter?
cleek
lying in the service of the Grand Old Party is no sin.
Roger Moore
No, no. Getting rid of the surplus was the justification until the economy started to slip up after the dot com bubble popped. After that, we were reducing taxes to get the economy moving again. The best part about tax cuts is that they’re the answer to every policy problem.
It’s all because 9/11 messed up the economy, and we needed to pay for two expensive wars and Medicare Part D. You just don’t realize how much worse the situation would have been if we hadn’t massively increased government revenues by reducing taxes on rich people.[/sarcasm]
Josh
And people wonder why I just gave up and call all of these people fucking morons.
When I call someone a fucking moron, I’m called the caustic, typical dirty-mouthed liberal.
I posit that what’s really offensive are these fucking morons and their fucking stupidity.
FormerSwingVoter
Dear all Conservatives who continuously claim forever that tax cuts pay for themselves:
http://modeledbehavior.com/2010/07/13/ezra-klein-is-dismayed-that-some-people-think-the-bush-tax-cuts-raised-revenue/
suzanne
Did you not get the memo? Spending all the money at strip clubs is just the GOP’s version of ECONOMIC STIMULUS.
Vomit.
Sentient Puddle
Pretty much every blog that touches on fiscal wonkery this morning got the revenue numbers, put it it in graph form, pointed out that tax revenues dropped like a prom dress from 2001 to 2005, and were all “WTF?”
So yeah, it shouldn’t be any issue for journalists to grab one of these graphs, show it to McConnell, and say “WTF?” to his face.
DougJ
Mark my words: Charles Lane will a defense of this.
ThatLeftTurnInABQ
Gotta give him some credit for that last sentence, at least. Finally, some truth in advertising.
Pity the nation that has a postmodern cargo cult for one of its two major political parties.
JCT
And people are going to lap this blatant falsehood right up..
That’s more depressing than watching adults who are unlikely to be complete morons blatantly lie in public.
I’m beginning to despair over this country.
jwb
I loved Krugman’s response to this, which has all the snark of our local headliners here:
“Put up a simple chart of revenues or growth over time, and they start screaming that you’re cherry-picking data; that you’re a liar for not mentioning Jimmy Carter, or something; or, the all-purpose response, 9/11! 9/11! 9/11!”
strawmanmunny
channeling the great conservative Charlton Heston, “It’s a MADHOUSE, a MADHOUSE”
I’m knee deep in a discussion on a sports forum about how Obama is racist and only cares about blacks as victims of terrorism because of his African interview. It’s mind boggling.
The scary thing is that the rubes actually BELIEVE this crap. I mean, they actually believe the stuff these “commentators” and “representatives” say. No matter how much evidence and facts you show them, they just double down on the ignorance.
I mean, how can you debate these people when they willfully just ignore all evidence? How can you get anything done?
I need a break….sorry for the rant.
RSR
he’s trying to play both sides of the laffer curve: that the lowered taxes increased consumer and business activities and therefore had–in isolation–a positive effect on tax revenues. And that may well be true; the theory is part of the series of individual tax rebates/cuts over the last few years as a stimulus.
But they can’t be viewed in isolation. They have to be considered as part of a net total, which in this case is an overall loss of tax revenue.
jl
I don’t have any helpful advice for Cole. If you read Krugman’s blog today, he is just as exasperated as Cole.
I would to fall into my reasonable moderate mode and say that it cannot all be blamed on the journalists, since they have to consult economists for expert opinion, and as we have seen, macroeconomics is a mess. However, one thing most respectable macroeconomists agree about is that the Laffer curve supply side theory that has been the basis for GOP fiscal policy experiments for almost 30 years not is completely false. US tax rates are far too low for Laffer style supply side effects of tax reductions to kick in, and this has been shown every time the experiment has been done.
Maybe journalists listen more to business/finance analysts and forecasters. But they are mixed bag, and you will hear anything from them. I have noted that the business economics experts who I hear and read who actually work in forecasting (that is, actually have to at least try to deliver on one of the main requirements of an empirical theory: that it can be used to predict the results of interventions in a system) sound more like the Keynesians (Krugman, Stiglitz, Galbraith and DeLong) than the GOP and the supply sider deadenders.
It is discouraging.
anonymous
America needs more Seppuku!
Vote for the Seppuku Party!
Ron
I predict that other than the “crazy liberals” nobody in the MSM will blink an eye at this.
SpotWeld
I wish there was some sort of outlet that could point out that as much as Dems are derided for “tax and spend” the GOP has pretty much offered not other alternative than “spend and spend”
JGabriel
What do you mean? Tax cuts are ALWAYS good. That they wouldn’t be is unpossible!
.
SteveinSC
Shades of David Stockman. We were told during the Reagan years that if we cut taxes on the wealthy, the rich would not try to hide their income from taxes, government income would actually go up, industry would flourish because the rich had more money to invest and voila–The Adam Smith Utopia.
The reason it didn’t happen, according to the GOP was that the Democrats controlled the congress and kept increasing spending too fast. The experiment was contaminated. Fast forward to Bush and a “moh bettah” experiment. Trillions of debt dollars later the fraud is there for all to see except the GOP and the cretinish stenographers.
Ash Can
In all fairness to the guy who wrote this article, he does cite multiple refutations to this bullshit, from multiple sources. And we have no evidence that the TPMDC guy that McConnell originally said this to didn’t laugh in McConnell’s face.
Having said that, though, I’d be loath to bet anything of value on the Very Serious (TM) pundits and bobbleheads questioning him on this (except maybe for the usual suspect such as Krugman and E. Klein). And you can be sure that his Sunday morning interviewers (because you just know he’s going to be on one of the shows somewhere) won’t say boo about it.
David in NY
@FormerSwingVoter:
Won’t work. Conservatives think Ockham’s razor is for shaving.
El Cid
@Sentient Puddle:
And then McConnell would say that ‘We disagree’ and ‘Those drops were caused by other factors’ and the ‘journalist’ would say, “There you have it from both sides, folks.”
Waynski
They’re stenographers pure and simple. Emphasis on simple. And they’ve got idiots on TV like Larry Kudlow and the bonehead economists at the University of Chicago to give them the patina of credibility they need to keep claiming it’s a he said she said argument. If there was a Republican economist that claimed we’d return to full employment if only everyone would simultaneously hit themselves in the balls with a hammer, they’d report that too.
El Cid
Richard Holbrooke on Rachel Maddow’s show last night explaining the Washington press corpse.
MikeJ
@SteveinSC:
I love when they use this argument. Clinton had the opposition in charge of the Congress but he didn’t take any shit from them. He let Newt close the federal government.
Clinton was a real man, macho, able to stand up to his adversaries and get what he wanted. So the GOP argument is that Reagan was a pansy, weak and ineffectual, incapable of leading.
Joshua
@El Cid: You forgot about the part where Michelle Malkin would find out where the journalist lived and inspect his countertops.
HyperIon
You’re in Dave Weigel territory now….imagining them all setting themselves on fire like Buddhist monks in Vietnam.
Ah, well, a boy can dream.
ajr22
The Republicans would have never lost the house, senate, and White house if it wasn’t for the mobs of ravenous Black Panthers patrolling the country. If it wasn’t for them the courty would be booming right now, and not just the economy, we would be in the midst of a giant freedom boom also, too.
Ron
@El Cid:
That pretty much sums up every discussion on CNN today
El Cid
@David in NY:
jl
@Ash Can: The writer attempts to present the other side, but the selection of links other than Klein and Yglesias are puzzling: they don’t directly contradict the GOP flimflam, and some approach the topic in such an indirect way, I doubt the average reader will be able to make much of them.
This blogger could not find a macroeconomist with name to address the issue directly? That is hard to believe, unless the post was tossed of in an hour or less.
El Cid
@Ron: “We’ll have to leave it there.” — Jon Stewart
Sentient Puddle
Ugh. More from the article:
Unspoken part: That’s about as complicated as the Laffer Curve gets, and thus has absolutely no predictive value. Anybody who uses it as a primary foundation for fiscal policy should be laughed out of the room.
(And really, I don’t think the article was bad. It was more wonky than 99% of articles on politics these days. I’m just pointing out that anyone who has ever gone through Macro 101 knows that the Laffer Curve should raise a red flag.)
EvolutionaryDesign
YAY! More “we’re totally fucked” news!
Warren Terra
It’s double-plus ungood to wrongthink like this. The reason for the Bush tax cuts has ALWAYS been to increase revenue.
In other news, Big Brother has increased the employment ration from 95% to 90%!
Davis X. Machina
He was always my favorite Pokemon character, too!
mclaren
WTF he’s talking about is Reaganomics.
People like you cheered themselves hoarse for this crap back in the 80s. And when hundreds of millions of people applaud these kinds of insane policies for 30 years, they seep into the general consciousness. It gets impossible to point out “that’s voodoo economics” when most of the country has been giving a standing ovation to this insanity for 30 years.
Too late now, buckaroo. The time to have debunked this kind of voodoo economics was 30 years ago, when Reagan first proposed it back in 1981.
After cheerleading for exactly that kind of fiscal insanity for 30 years, you can’t turn around now and start claiming “That just makes zero sense whatsoever.” It’s a done deal now. Everyone agrees that this insanity is a solid reputable policy called “Reaganomics.” Too late to debunk it — it’s now settled into popular consciousness as part of the common wisdom. You had your chance in 1981. Now you just look like a flat earther because Reaganomics is something “everyone knows” is a wise and brilliant economic policy.
Thoughtcrime
The way I see it, they’ve been Laffering all the way to the bank for the last 29 years.
Davis X. Machina
Why we still see it fairly often in print when, say, medical reporting is pretty much free from references to the humoral theory, and science writers rarely refer any more to phlogiston, or the luminiferous ether, is a puzzlement, though.
scarshapedstar
I sure wish more talking heads would be An Hero.
Pangloss
So let me get this straight— if we eliminated taxes, there wouldn’t be enough room in Washington to hold the extra revenue, and if we went to negative taxation, people would die under the crushing piles of the mushrooming revenues?
Midnight Marauder
@jl:
You know what? This can be blamed in large part, if not entirely, on the Fourth Estate. You don’t need to consult with some kind of top-tier economist to understand that the zombie lie about tax cuts is complete and utter bullshit. You don’t need business or finance analysts to crunch some numbers for you. All you would really need to do is a Lexis Nexis search on the subject and discover that George W. Bush’s own chair of the Council of Economic Advisers outright rejected the idea that tax cuts pay for themselves.
Besides the actually statements of the people who initially instituted the policy and then rejected it as fantasyland nonsense, you also have the numerous easy-to-read charts and graphs that have been produced time and time again during these discussions. But again, it’s the standard Village operating procedure: you get a topic for a story, you don’t actually research it–but instead–find a few “credible authorities” on the matter, you print their quotes in ol’ “they said this/they said that” template, and voila! You’ve got “journalism” without the slightest worry about learning a single critical element about the topic you’re covering.
Really, you can blame them for a lot of things. It’s okay. They don’t deserve your sympathy.
DonkeyKong
Historian’s will look back on this period of American history as “The Great Losing of Our Shit”
Rinky dink ACORN forced Multinational Banks to loan to poor people, and don’t get me started on the NEW black panther party.
Tax cut’s raise revenue (are you laffering?)
We need to confront a few hundred radical jihadist with the same spending we used to confront the massive arsenal of the Soviet Union.
Wealthy people are being demonized (they’re being left out of all the fun-unemployment the rest of us are enjoying.)
Teabaggers are forced to wear founding father costumes because Robert E Lee and Jeff Davis costumes are on a waiting list.
Jeebus Wept…..
jrg
Stupid liberals. If I have a dollar, and I give it to you, then you have a dollar, and I have nothing.
However, If I have a dollar, and I don’t give you a dollar, then you have a dollar, and I have a dollar. This is basic mathematics.
You may ask where the extra dollar came from. The answer is “shut up and go smoke some reefer, hippie”. Q to the E to the motherfucking D.
ThatLeftTurnInABQ
@jl:
Not sure I buy this caveat. Economics is central to modern politics. A political reporter who is a complete naif on macro-economics is going to be grossly incompetent at their core job function. Nobody has any business reporting on politics without at bare minimum the same level of knowlege of macro-econ as what the regulars on this blog display.
Of course from the standpoint of our media overlords, a headsmacking level of stupidity and ignorance in their reporting staff is a feature not a bug..
licensed to kill time
@El Cid: I guess they’ll have to quit going to the rodeo now, too.
edit: never mind, El Cid’s comment inexplicably disappeared.
Davis X. Machina
You can never tell, huh? Based on all the arm-candy he’s been photographed with, up in NY and DC, and back in Tennessee, I always assumed young Harold was straight.
Bulworth
Well, it’s true that some people say tax cuts decrease revenue, but other people say tax cuts increase revenue. And by the way, aren’t those people who say tax cuts decrease revenue just silly? Isn’t this laugher curve neat?!
Ron
For whatever it’s worth, there is a legitimate principle to the Laffer curve. At 0% taxes, revenue is 0. At 100% taxes, revenue would presumably be at 0 as well (why work if you don’t get paid anything). So somewhere between 0% and 100% is the tax rate that maximizes revenue. So far, so good. The problem is that we have absolutely no idea what the graph of revenue vs tax rate looks like, especially since we have progressive taxes that aren’t a single rate. It would be some function of several variables (the different rates and the different cutoff points) that would probably be almost impossible to determine.
Rommie
@strawmanmunny:
~~~channeling the great conservative Charlton Heston, “It’s a MADHOUSE, a MADHOUSE”
And if they win control of the House and/or Senate, they’ll be spraying that fire hose at full blast for the next two years! Yay.
Comrade Javamanphil
All serious journalists have other things to do like monitor Sarah Palin’s Facebook page and repeat it verbatim.
jl
More bad news, from Krugman’s blog, Erskine Bowles one of the co-commissioners of the debt reduction, excuse me, I meant cat food for old people commission, does not understand how to calculate a national debt burden over time.
So, both heads (Bowles and the arrogant and confused Simpson) of this miserable commission are not competent to understand the basics of national debt. That is not good.
Delusions About Debt Dynamics
Krugman, NYT blog
July 14
http://krugman.blogs.nytimes.com/2010/07/14/delusions-about-debt-dynamics
Obama must take some constructive action soon on the economy. In terms of popular support, he is reaping the consequences of a lousy job market that all presidents have faced, including Reagan.
I have read enough anecdotes about Obama and his economics advisers that my opinion is that he simply does not understand economics very well, and is deferring to consensus mainstream thinking (Summers, and Geithner who denies being ‘an economist’ whenever he needs to wriggle out from under a tough question). Problem is that the mainstream consensus is bankrupt.
I read after a meeting with Stiglitz and Krugman, Obama was buffaloed by Geithner into believing that Stiglitz and Krugman disagreed about most things, and were giving contradictory advice! The only think I can think of that those two disagree on is how to deal with PRC currency issue.
I hope Obama can follow common sense and experiment when things aren’t working, like FDR and Truman. So far he is more like Eisenhower, except less willing to fire people when their economic policies do not pan out.
Sentient Puddle
@Davis X. Machina:
Because it’s still a reasonably good way to illustrate a broad concept to the layperson. That’s about all you can do with it, though.
cleek
if economics was a little less err… open to interpretation, it might be possible for journalists to shake out the chaff.
but when Mr Partisan Q. Hack III of The Tax Cut Jesus Institute can go on TV and cite a bushel of economists who are happy to back up whatever he’s trying to sell that day, it’s hard for journalists to question this stuff.
SpotWeld
The Laffer curve is a thought experiment, a means of illustraiting a concept … but what no one ever seems to point out is that there is no functional way to determine where on that hypothetical curve the current economy would be placed
Wile E. Quixote
@Davis X. Machina:
Because medicine is a science as are chemistry and physics whereas economics is bullshit.
Davis X. Machina
@SpotWeld: Not strictly true — asking ‘which party is in power’ gives you that data point….
Joshua
@Sentient Puddle:
The problem with how it is used, though, and I am sure you know this, is that the focus is always on the right side – the 100% part. In the media nobody ever talks about the left side. This leads to, quite accidently I am sure, the idea among the laypeople that we are on the right hand side.
Problem is, all evidence points to the fact that we are firmly on the left hand side of this curve and have been for decades.
jl
@Ron: Yes we do understand what the Laffer curve looks like, and estimating where different countries are on that curve has been a macroeconometrics cottage industry for a long time. You can find estimates of it, or where we are on the curve, starting from introductory macro texts, and on up to intermediate and advanced. Any text other than purely theoretical will discuss estimation of the Laffer curve.
I suggest Blanchard’s text to begin with, and used, very cheap, recent editions are available on Amazon.
Comrade Colette Collaboratrice
@ajr22: What does a giant freedom boom sound like?
El Cid
Great. I just got labeled as “spam” because I linked to a Ford Fiesta for a topical reason.
Sentient Puddle
@Ron: There’s a more fundamental problem than just that: the underlying economy isn’t constant, which makes the curve inherently untestable. If you can’t hold the GDP constant (and I use GDP as a gross simplification for the entire economy), you can’t plot a reliable tax rates vs. revenue chart.
Hell, if we want to get pedantic, we can’t even prove that the Laffer Curve is actually parabolic. For all we know, it might have multiple maximums.
David in NY
@El Cid:
Thanks, I couldn’t remember which number Mach my Ockham had.
Davis X. Machina
@Wile E. Quixote: Not so much bullshit as a species of moral philosophy.
stuckinred
News flash, Darth had major heart surgery last week.
David in NY
@stuckinred:
The Darth? Is he recovering badly?? (hoping)
jl
A recent example of estimation of the ‘Laffer curve’ sorry no free view, you can buy for five bucks. I will look for a review article.
How far are we from the slippery slope? The Laffer curve revisited
M Trabandt, H Uhlig
NBER Working Papers, 2009
Working Paper No. 1534
We characterize the Laffer curves for labor taxation and capital income taxation quantitatively for the US, the EU-14 and individual European countries by comparing the balanced growth paths of a neoclassical growth model featuring ”constant Frisch elasticity” (CFE) preferences. We derive properties of CFE preferences. We provide new tax rate data. For benchmark parameters, we find that the US can increase tax revenues by 30% by raising labor taxes and 6% by raising capital income taxes. For the EU-14 we obtain 8% and 1%. Denmark and Sweden are on the wrong side of the Laffer curve for capital income taxation.
David Hunt
I feel quite confident that they practice in front of a mirror.
Midnight Marauder
@Comrade Colette Collaboratrice:
I think John Ashcroft has you covered.
cleek
the Laffer curve explains govt revenue to tax rates in the same way the speed of a car explains the RPM of the engine – without accounting for the HP of the engine, the number of cylinders, the weight of the car, the shape of the car, the transmission and the gear its in, the type of fuel, the incline of the road, the skill of the driver, the wind, the road surface, the presence of turbo-/super-charging, the size of the wheels, the suspension, the composition of the tires, the presence of a nagging passenger, other traffic on the road, the number of beers the driver’s had, etc..
Nethead Jay
@El Cid: Maddow’s whole interview with Holbrooke was great, but that final coda was simply awesome. And I imagine he knew exactly what he was doing. With a little luck, that one is going to zing around Washington for a while. Did you notice his sort-of-swipe at Chris Matthews?
my name here
Also, isn’t it funny how Kyl says he won’t vote for unemployment extensions because that would increase the deficit, but then claims that tax cuts never have to be offset because that’s giving money back to the American people. Wait, did I say funny, I meant enraging and depressing all at the same time.
patrick II
I have posted this comment before, but every once in awhile when I see a “how could they say that about taxes and deficits?” I re-post it to make sure everyone understands it is a deliberate lie and why they do it:
Anyone who cares about this and doesn’t know the “Two Santa Clause” theory should read this story:
http://www.commondreams.org/view/2009/01/26-0
excerpt:
…But Wanniski had been doing his homework on how to sell supply-side economics. In 1976, he rolled out to the hard-right insiders in the Republican Party his “Two Santa Clauses” theory, which would enable the Republicans to take power in America for the next thirty years.
Democrats, he said, had been able to be “Santa Clauses” by giving people things from the largesse of the federal government. Republicans could do that, too – spending could actually increase. Plus, Republicans could be double Santa Clauses by cutting people’s taxes! For working people it would only be a small token – a few hundred dollars a year on average – but would be heavily marketed. And for the rich it would amount to hundreds of billions of dollars in tax cuts…”
It’s a deliberate strategy used by republicans to diminish the power of government by strangling it using tax cuts to bribe the electorate and deliberately cause deficits, and then have crocodile tears about those same deficits when the democrats are in office. It goes past hypocrisy into cynical, devious lies and manipulation.
schrodinger's cat
Economics is not a science, running everything (government, universities etc) as if it were a business is not a good idea either. I don’t know what the answer is, but the status-quo certainly isn’t.
Alex S.
We’re all having fun on the Laffer slide.
mclaren
@Ron:
That’s ignorant crap.
At 0% taxes you get Somalia, which is ruled by warlords, so revenue is 100% because the warlords steal everything that isn’t nailed down.
At 100% taxes you’re living in the Soviet Union, so revenue is 100% because the government owns everything so all revenue from every industry and every service goes straight back to the government.
Learn some basic economics. You’re making a fool of yourself.
Ron
@Sentient Puddle: There are so many problems with it it’s hard to list them all. It’s ridiculous that it’s used to justify anything at all.
David in NY
An OT warning. Do not click on the ad at the head of the comments that asks what number you see in a bunch of dots. I did so inadvertently and it wouldn’t let go of me and was extremely annoying (and I hope that is all).
Gregory
I know! “Liberal media”! What do I win?
ajr22
@Comrade Colette Collaboratrice: Not sure what it sounds like, but it smells like Napalm in the morning.
eemom
to give a Hiatt his due, the WaPo does have an editorial today attacking the tax cuts insanity.
burnspbesq
@mclaren:
I don’t envy you. It must be hard being the only pure person left on earth.
mclaren
@Wile E. Coyote:
If medicine were run the way economics is run, Typhoid Mary would have an endowed chair of medicine at Harvard and she’d be giving graduate lectures to audiences dropping dead at her feet of the disease she was carrying.
If physics departments operated like the economics departments of major universities, perpetual motion machinists would receive Nobel prizes while Witten and T’Hooft were ridiculed and refused tenure.
If chemistry produced the same results as a economics, we’d be spending half the GDP of America trying to turn lead into gold while people still puzzled about what water was made of.
Corner Stone
@jl: Why do you hate Obama? Are you upset he hasn’t given you your pony yet?
eemom
@stuckinred:
stop me before I wish evil upon the evil. Oops, too late.
mclaren
@burnspbesq:
Fixed.
Yes, it’s like living on the Planet of the Apes, except with economists.
Brendan M
@Midnight Marauder:
I was going to say “Join Fox News !”
oops – props to Cathie in Canada – who beat me to it!
NobodySpecial
@Corner Stone: The pony deficit is a clear concern of Balloon Juicers across the world.
SiubhanDuinne
O/T but Cheney had surgery last week on his non-existent heart.
Got info from WaPo alert:
——————–
News Alert: Former vice president Cheney says he had heart surgery last week
04:35 PM EDT Wednesday, July 14, 2010
——————–
Former vice president Dick Cheney said in a statement Wednesday that he underwent surgery last week after he “began to experience increasing congestive heart failure,” the Reuters news service reported. Doctors implanted a new heart pump in Cheney, 69, who has a long history of heart problems.
For more information, visit washingtonpost.com:
http://link.email.washingtonpost.com/r/46MP2V/5OLCW/2OQ9BX/CNYDSU/14YIG/RF/t
TheF79
Speaking of thought experiments, it would be nice if our journalists could lay out what the Laffer Curve implies at current tax rates. Taking a 25% of GDP rate as the approximate tax rate, for every dollar given up in tax cuts, four dollars of additional GDP would need to be generated just to break even (25%*$4 = $1). That’s just freaking crazy – to put it into perspective, that would imply a “smallish” tax cut of $100 billion annually (~$300 per capita) would need to generate $400 billion in annual GDP growth, or about 3% (roughly equal to the long-run growth trend of the US). That’s fantasy-land stuff.
Now, if tax rates are at 80%, then for every dollar given up in tax cuts, $1.25 in GDP would need to be generated to make up the difference, which is a lot more plausible.
Joshua
@patrick II:
Not to mention childishness. Functionally the GOP has taken power by telling Americans they can get good services without paying for them… and Americans have bought it.
It’s why California is so screwed up. California voters gave themselves a huge tax cut with Prop 13, and have spent the past 30+ years giving themselves great public services. I was in CA not more than 4 years yet I saw billions of dollars of government spending pass through propositions.
This was DURING and AFTER the budget deficit that led to Grey Davis’ ouster by the way. And the guy who replaced him made his first order of business… a proposition to issue bonds to cover the deficit. Californians voted for it.
Michael
@jrg:
FT mothafuckin’ Win.
ruemara
@ThatLeftTurnInABQ:
A win, for mentioning Super Robot Hyperforce Monkey Team GO, which was super awesome.
Where shall I deliver your internets?
SiubhanDuinne
@Thoughtcrime:
I admit it. I groaned.
Zandar
The vibrancy of “invincible ignorance”.
We are now governed by applied Somebody Else’s Problem Fields.
General Stuck
@SiubhanDuinne:
The Devil at his bedside.
Waiting, anxiously.
cat48
Even Bruce Bartlett has admitted that supply side economics/the Laffer Curve are absolute hooey. The debt & deficit Reagan left behind should have been proof enough. But, no we had to go thru this nonsense again w/Bush yet the repubs still push it today. I think they should receive an electric shock everytime they assert this insane theory.
They’re all on message and even have an editorial to verify it in the WSJ today. Of course WashPost has an editorial refuting it, but which one will they use?
OT Looks like Cheney had heart surgery & a new special pump implanted to wait on a transplant if MSNBC is correct. Not surprising to me since he became out of breath just trying to talk at times. He had congestive heart failure.
NobodySpecial
The worst part for Cheney about having a heart attack is that he can never remember which house he left it in.
Alex S.
Cheney will drop dead the day after the release of his memoirs. Only his will is keeping him alive. He wants to preserve his “legacy”.
WereBear (itouch)
Next, Republicans will discover Zeno’s Curve, where the government never actually gets the revenue at all.
BC
Well, if the current journalists were more like the average person income-wise, they probably would laugh at McConnell. But when your income is in the $250K +, then it is your ox getting gored by the increase in taxes. Don’t want to mention that, because then it’s apparent you have skin in the game. So you just become a stenographer and never have to explain. The worst thing that happened to journalism in this country is that the reporters on tv and in major newspapers became upper middle class and lost their perspective on economics.
mclaren
@Joshua:
The problem with Reaganomics/Californiaccounting is that it seems to work…for a while.
When you cut taxes, government revenues collapse but everything seems to be fine for a few years. Critics predict disaster but you don’t see any drastic changes — not at first. Only gradually does your infrastructure decay, but it happens over so many years you don’t notice. Eventually the schools fall apart and the streets fill with homeless people, but if you’re middle class you don’t really notice it except peripherally.
It’s only after 20 or 30 years that the disastrous effects start to make themselves shockingly clear. The decaying infrastructure makes it impossible for American businesses to compete with countries that have modern broadband and well-maintained highways, so American businesses decay and collapse and the GDP declines and employment tanks. The disintegrating schools can’t produce students able to compete with workers in the rest of the world so the U.S. falls farther behind Europe and Asia every year. And eventually you become one of the homeless people on the street because your job disappears and you lose your house…but by then it’s 30 years down the road, and it’s too late.
Eating your seed corn seems like a magnificent clever strategy. For the first few years, that is.
SixStringFanatic
I’m gonna go out on a limb here and say I don’t really see this article as all that outrageous. No, the author of the article doesn’t laugh in McConnell’s face and the headline is pretty misleading (as most headlines are, really). But, using polite language and an even-handed tone, the author, Brian Montopoli, does a pretty good job of exposing the Republican argument for the nonsense that it is. All of the articles that Montopoli links to not only shred the “tax cuts don’t need to be paid for” argument, they also ridicule the idea. Even better, he ends the piece with these paragraphs:
“Liberals have been quick to contrast Republicans’ position on the Bush tax cuts for the wealthy with GOP efforts to block an extension of unemployment benefits unless they are paid for. If the Bush tax cuts for the wealthy pay for themselves, they suggest, wouldn’t putting money in the pockets of the unemployed have the same effect? (In fact, it could be argued money for the unemployed would have an even more significant effect, since that group would seem to have more need to actually spend the money.)
The GOP’s position has the left arguing that despite their ostensible fealty to Tea Party-driven concerns about red ink, conservatives don’t really care about the deficit, as Matt Yglesias put it.
He cites as evidence McConnell’s position as well as deficit increases under Presidents Ronald Reagan and George W. Bush and opposition from conservatives to a pair of deficit reduction packages in the 1990s.”
Not a bad ending, really. In one paragraph he does a pretty good job of not only explaining but also bolstering the Democratic position that unemployment benefits are better than tax cuts for the rich and then in the last two paragraphs he introduces an idea that many of us would like to see more of in the MainStreamMedia: The Republicans don’t really care about the deficit.
This is probably as good as we’re going to get, at this moment, from CBS News. No, Montopoli doesn’t laugh openly at McConnell or ridicule him or call him a lying cunt. But isn’t that what bloggers and Matt Taibbi are for?
matoko_chan
@Joshua: nah.
this is how it works.
the stupid people (of which there are a large majority) elect a stupid person, one of their own. things get badly screwed up, and this presents an opening for a smart person to get elected. the smart person fixes things and all is good and then the stupid people remember how much they despise intellectuals and elites telling them what to do.
so they elect another stupid person because every one is equal.
And the stupid person screws everything up again.
wash, rinse, repeat.
SixStringFanatic
Fucking WordPress.
The two paragraphs following the one in bold text should also be bolded. I was gonna be clever and get around the WP multi-paragraph-block-quote bug. Fuck me, it does the same thing to multi-para bolding efforts.
Ash Can
@mclaren: You’re overdoing it. Ron was explaining the mathematical formula upon which the Laffer Curve is based, and it is a real formula. The argument you really wanted to make was that simple mathematical formulas can’t be applied effectively to the real world, because the number and nature of the real-world variables overwhelm the simplicity of the formula. Instead, your criticism came off as knee-jerk and unserious.
blackwaterdog
Clearly, it’s working. This stupid country is all but ready to let these assholes back to power. People will get exactly what they deserve.
SiubhanDuinne
@SiubhanDuinne:
Hmmm. When I posted this, I was pretty sure I was the first one — because I actually took the time to run a search for the word “Cheney” in case someone else had got there first. Well, nobody else had, so I went ahead with the news flash.
How was I to know that @stuckinred: and @David in NY: and @eemom: would all discuss it first without ever mentioning his name. Nice work.
SiubhanDuinne
Okay, I give up. Why am I in moderation at #114? I didn’t use any of the Bad Words . . . .
Oh, wait. Maybe “C h e n e y” is now in the “forbidden” lexicon. High time, too.
ETA: Oh, sad. I guess it was because of three reply links. Durn. I was so hoping.
Chris
Couple of notes on the Laffer Curve…
I don’t know if I can insert images, but first, a link to how badly some people want to see a Laffer Curve where there is none….
Anyway, here is a standard Laffer Curve:
There are two huge problems with it. One is, even if it is accurate, we have no idea where we are on it, except if we are at the 0% or 100% ends. The other is, it’s just not accurate. Even the people who believe in it in general will agree that instead of a smooth arc from “zero intake at 0%” to “zero intake at 100%”, an “accurate Laffer curve” (if it existed) would be lumpy and bumpy and shift around over time. So not only do we not know “where we are” on it (and hence whether to increase or decrease taxes in order to increase or decrease government revenue from taxes), we also cannot find out because any change in tax rates could cause a “localized bump” to change the delta-revenue in the “wrong” direction.
(I have to run now, let’s see if the img tag worked … if not, use the link)
WereBear (itouch)
As always, I’m rather surprised Darth Cheney has so many issues with an organ that has never been used.
Dr. Psycho
@David in NY: Don’t hope for Cheney to die. So long as he lives, there is still hope that he will be indicted.
Omnes Omnibus
@WereBear (itouch):
It atrophied, leading to problems.
David in NY
@SixStringFanatic:
Maybe that’s the best we can get, but I think John’s point stands. McConnell’s claim that tax cuts generally, and this tax cut in particular, raise revenues is simply false. And reporters just don’t challenge such claims. Ever. And they probably ought to, though not by calling the politician a “lying cunt,” however true that might be.
David in NY
@Dr. Psycho:
I didn’t want him to die. Just to experience about the level of discomfort of someone being waterboarded, say, until his ultimate recovery.
Jasper
@Fwiffo:
“We’re always on the far side of the Laffer curve.”
You do realize that right wingers don’t recognize that the Laffer Curve is bell shaped.
For amusement purposes, ask any right winger about the rate at the peak of the Laffer Curve. Not one I’ve asked has even considered the question. All they know is tax rate cuts increase tax revenues, and Laffer proved it on a napkin.
Nick
Resident journalist here…we don’t write it with a straight face, we tend to laugh at the absurdity, but we do what the people who sign our checks tell us.
Tonal Crow
I’m Laffing myself sick at our “liberal media”.
eemom
@SiubhanDuinne:
He Who Must Not Be Named, incarnate.
Cacti
Kyl and McConnell are just regurgitating the Ronald Reagan voodoo economics that have been an article of faith in the GOP for the last 30 years. Faith and not fact because there isn’t a shred of evidence that this approach produces anything but buckets of red ink.
In a shocking coincidence, not a single Republican POTUS who followed this model has seen a balanced budget under their administration.
Svensker
@Cacti:
Well, that’s because they were all followed by Dems, who STOLE ALL THE GLORY! Silly.
oscarbob
Diploma, we don’t need no steenkin’ diploma!
Nylund
Well, that is true, it has been their view. It doesn’t make it factually correct though.
This gets to the major issue with journalism today. The extreme love for avoiding any sense of bias means they treat all viewpoint as equally valid, even if those viewpoints entirely contradict each other or some go against every bit of fact and empirical evidence that exists.
The same problem exists for polls. Go to Conservepedia and their “evidence” that evolution is not true is based on the fact that a high number of Americans believe it is not.
It seems to me like the entire GOP platform is based on the idea that if you simply clap louder, it makes it true. And the scary thing is that with the media’s help, a scary amount of Americans are falling for it.
Honus
@matoko_chan: pretty good, except you left out the evolution of the system in recent decades that the stupid person is then hailed s a great American hero.
Honus
@matoko_chan: pretty good, except you left out the evolution of the system in recent decades that the stupid person is then hailed s a great American hero.
Jager
1. They don’t have straight faces.
2. They have no idea what they are talking about.
3. Mitch McConnel has no chin and in real life he’d be fortunate to get a job at Lowes as a nail salesman.
Ron
@mclaren: Wow, someone took their “be an asshole” pills. I’m not remotely embarassing myself. I never said the Laffer curve could be used in any real world fashion. EVERY economist agrees with the 0% and 100% ends of the curve. That isn’t remotely controversial. Obviously there are social problems with both 0% and 100% taxation rates aside from the zero revenue and neither could actually provide for a functional society. The point is that there is theoretically a model of revenue as a function of taxation rates that must have a maximum somewhere. The problem is coming up with a viable model is virtually impossible.
mclaren
@Ron:
There you are. Proof positive that the 0% and 100% ends of the Laffer are bullshit.
Moreover, it’s obvious and easy to prove, since economics describes human behavior — 0% is in fact Somalia, where the warlords do in fact grab 100% of revenue. And 100% is in fact the former Soviet Union, where the government once again gets 100%.
So the economists are stupid as well as ignorant and incompetent, since they get the most basic elements of the Laffer curve — namely the two endpoints –100% completely utterly wrong.
But we already knew that, didn’t we? Economists have the same predictive track record as astrologers.
Platonicspoof
It’s Nick’s Fault! ; )
cleek
actually, warlords do not take 100% of revenues.
an individual could be robbed of everything by a warlord (or by anyone, really). but that’s not anything like a general economy-wide 100% tax.
Lurking Canadian
The great palmed card of the supply-siders is that first they start out talking about overall tax rates (% GDP), with their 0% – 100% curve, then hey presto, they’re talking about marginal rates.
A government that consumed 100% of GDP would severely stifle an economy. I doubt GDP would entirely drop to zero (not everybody in Stalin’s Russia starved to death), but it would certainly be stifling.
On the other hand, a government that, say, taxed all personal income above $1M/year at a rate of 100% but left all other tax rates the same would NOT see tax revenues drop to zero, or even close to it. It would certainly distort the economy, but there’s no reason to think the 99.9% of us unaffected by the tax wouldn’t just keep going about our business.
The supply siders deliberately confuse these two, with their obsession with private investment capital causing growth, because what they really want to do is stop paying taxes themselves. The rest is bullshit.
cleek
@Lurking Canadian:
personally, i’m not sure i know anyone IRL, besides my accountant, who knows what a marginal tax rate is. the people i’ve talked to about this think they pay the same tax rate on all income, and that if they make too much, they’ll jump int the next bracket and reduce their take home pay.
obviously this kind of thing works out well for the tax demagogues.