Why the econimy hit the fan in 2000

“I recently heard this idea on talk radio. The host was saying that the reason Bloomberg in NYC has to fire so many people and Bush has to cut the budget is because during prosperous years government grew and flourished off of the prosperous budget. But when the budget goes down a little, the economy hits the fan. It makes sense that when the government was making more money they used all of it with social programs and big government, but when there is a little down turn and the govn’t makes less money they cry to keep the same budget as the past, the same excessive budget.

Think people, this is like if you went from a job making 60k a year to 100k a year. With that huge increase you go and buy a Benz, a large home and maybe a boat. All is well because your are making 100K a year and can afford all of this. But when you where making 60 K a year, you had a midsize sedan or compact car, and a modest home. It worked; you had shelter and a transport. Everything was basically fine. Now you lost your 100K jobs and got hired some were else at 80K. You are still earning more than before but now you can’t afford the taxes on the castle or the insurance on the Benz. Now you are running around frantic trying to find ways to cut spending, never thinking to sell the Benz and go back to the Ford, while there is nothing wrong with the ford at all, its just not as nice.

I’m not sure if I explained that as I have it in my mind.”

“i'm not sure what conclusion you're drawing here but i'll wade in the pool ....

the only way for government is to take it from the citizens. the government is there to protect us, adjudicate disputes, and provide some social services....and that's it...

it is not there for creating jobs. it is not there to be wastefull and inefficient.

also, government does not give us our rights....we have rights because we are human beings.”

“a 60k job would be a big step up for me.

i think it would be more accurate to say "we have rights because we are citizens of a free nation"

lots of humans dont have rights”

“obviously....i was using "we" as in we americans....my bad

"Only kings, editors, and people with tapeworm have
the right to use the editorial 'we'." --Mark Twain”

“2scoops, I was using those numbers for living in NJ.

60K in my area is nothing, food clothing rent/housing insurance is so much more expensive than where ever you live. Its all relitive to location.”

“60K puts you into the top (roughly 75% of wage earners in the nation....you know how tom dashel says the tax cut are for the rich? well, if you make 60K, he's talkin about you...


don't get me started...”

“ice, youre the second person from nj to say basically the same thing. gah. as if i didnt already need an incentive not to move to the dirtiest state in the union.”

“mark twain rules HE RULES!

im sorry to make an unrelated post, but heres another Twainism:

Outside of a dog, a book is man's best friend. Inside of a dog, it's too dark to read.”

“1) Stock market bubble egged on by crooked brokers, corporate officers, etc.

followed by

2) A whopping vote of No Confidence for the market, W and the Republican Congress.

Investors vote with their dollars.”

“strat, a NYC cop and Teacher make over the so called "rich income" but we all know they aynt rich by any means. Yet Tom Dashel seems to think so, and thinks you should be taxed more.”

“Hoo boy, is that 60K per capita, or 60K per household?

There's a big difference, boys.”

“And uh, we have BIGGER government than ever with the "borrow and spend" weenies in command.”

“There are two things missing in the right wing's "bloated budget of the 90s spin".

1) Budgets didn't increase that much. Welfare rolls were cut almost in half during the 90s.

2) The bigger budget impact was the big tax cuts of the late 90s and the first two years of this century. The tax cutters swore that no budget crisis would result. Bush was one of them and promised the cut would create 800K new jobs (I might not remember the number exactly). In MA and in the USA, a huge portion of the deficit can be accounted for by tax cuts.”

“The other spin here is Republican, the economy didn't hit the fan in 2000. There was a pretty insignificant down turn when Bush hit the White House, the kind we've had many times in the post WWII era. It turned into something else under Bush's watch.

Interesting... Bush I raises taxes and trims the deficit and the economy goes up, Clinton raises taxes and balances the budget meanwhile the exonomy goes way up and we have surpluses. Bush raises taxes to "stimulate" the economy, busts the budget and we've got problems. Even the war isn't enought to stimulate the economy.”

“...cuts...?”

“How did I know who started this thread :o)

You didn't factor the tax cuts in that equation of yours Ice. Otherwise, of course, there's more money coming in when the economy is booming - giving you more to spend. As for too high spending during the Clinton era, then I think the growth stats will say he got it just about right.”

“Right or Left ya all attribute to much economic power to the guberment. The real power behind our economy is the people and the businesses. The guberment budget is just to small, the tax cuts are just to small to have the effects we have been promised or warned about good or bad. Your both wrong. Everything needs to be looked at as a percentage of GDP. I am for tax cuts as a moral issue and any economic stimulus would just be a good side effect. If the truth be known I bet GWB is for them on the same grounds, he just can’t sell them that way. It is just not honorable to take so much money. Theft through legislation is still theft. Its just not illegal. I do not expect the guberment to protect me from all risks. Protection from some risks, yes, but there is a limit. The guberment is not the answer to all problem, including economic problems. A do nothing guberment is sometimes a good thing.”

“mtn gal: You're sounding a bit like a bit like Herbert Hoover there.”

“pssst....it's YOUR money”

“I knew this was a thread started by Ice Tea.”

“"psssttt.. it's also my country and my debt - that is all that money is being borrowed on the taxpayers credit, and we'll be paying interest on it for many generations."
pedxing


ped, did you know you can voluntarily pay extra on your taxes? i suggest you do so since you think letting the gubment spend your money is the answer to all our problems. just don't force me to do so......”

“Has anyone else notice how many people have resigned from this administration lately? Todd-Whitman just annouced today she's leaving for he smae reasons Ari did. I hope the rats aren't jumping off the ship.....”

“I'd rather keep all the money I earn, too. Who needs roads, schools, police, sewers or the military?”

“This looks like it will be a loooong, ugly thread. >8P”

“I love it when people like Strat piss and moan about the government spending all THEIR money.

Guess what? We just dropped over $100 billion of TAXPAYER MONEY to invade a sovereign nation. Guess where that money is gonna be coming from, jack? Your friggin' GRANDKIDS!!!”

“I, for one, am thankful for all the federal subsidies we have here in the West; cheap hydropower, rural air service, ag/farm/ranch subsidies, irrigation, below-cost timber and huge highway dollars for our sparse population.
Although westerners like to tout their independence and getting government off their backs, they always have a severe case of withdrawal when the money trough is taken away.”

“Thomas Sowell
January 14, 2003
Economic vs. politics
The familiar chorus of "tax cuts for the rich" has begun to ring out across the political landscape, in the wake of President Bush's proposals to boost the economy. The time is long overdue to expose some of the fallacies folded up inside that phrase.
The dirty little secret is that those defined as "the rich" by liberal politicians include most of the American people, in the course of their lifetimes. Even people who were in the bottom 20 percent in income in 1975 were also in the top 20 percent at some point over the next two decades.
There is nothing mysterious about the fact that most people start out making beginners' salaries and their incomes rise over the years until they reach a peak, usually in their 40s or 50s. Even then, they are not rich by anyone's standard, except that of politicians who want to tax them heavily.
Those who are crying "tax cuts for the rich" never define where "rich" begins. It takes a household income of just $83,500 to be in the top 20 percent. A couple of people making a little over 40 grand apiece are not rich. Even to make the top 5 percent requires a household income of just over $150,000. Seventy-five grand apiece is a nice income, but you are not going to buy a yacht or a Rolls Royce with that.
When politicians talk about "the rich" that they want to tax, send not to know for whom the bell tolls. It tolls for thee -- if not now, then at some other point in your life.
Talk about how tax cuts will "give" money to the rich is very misleading. Thinking about the economy solely in terms of money ignores the fact that income and wealth consist of real things -- food and shelter, automobiles and airplanes, factories and farms.
To boost the economy means increasing real production. Boosting the economy requires policies that change people's behavior, causing more people to be hired, more work to be done, and more production to result.
The point of cutting taxes on dividends is not -- repeat, not -- to get dividend recipients to spend more money, if and when they receive those dividends somewhere down the road. The point is to get them to invest right now, creating jobs right now, so that employment will go up and real output will rise.
Those who think solely in terms of money prefer to extend the period for receiving unemployment benefits. But paying people longer for not working makes no sense if you want more output.
Perhaps the most ridiculous of all the economic fallacies produced by politicians is that "tax cuts for the rich" are supposed to cause money to "trickle down" to those in lower income brackets. This is a pure straw man.
As someone who spent the first decade of his career researching, teaching, and writing about the history of economic ideas, let me assure you that there is no such thing as a "trickle-down" theory. No economist of any school of thought has ever proposed any such thing.
Cuts in tax rates are intended to do what past tax cuts have done before -- under both John F. Kennedy and Ronald Reagan -- namely, cause an increase in real economic activity. In both cases, the government received more tax revenues, as a result of rising economic activity, than it had received when tax rates were higher.
That is why it is so misleading to express a tax cut in terms of so many billions of dollars. The government can only change tax rates. How much revenue will increase or decrease is something they will find out later.
Tax cuts should be immediate, if you want results to be immediate. Stretching out the tax cuts, as was done initially in order to get political support, gives people incentives to wait before investing. Waiting is not what you want.
The only people whose taxes can be cut are people who are paying taxes. This simple and obvious fact gets overlooked by those who are busy crying "tax cuts for the rich." Tax rates are so skewed that a relatively small percentage of the population pays a huge proportion of the taxes at any given time.
That ensures that any serious tax cut will qualify as "tax cuts for the rich" -- as defined by liberals. How they get away with this phony stuff is one of the mysteries of our time.
Thomas Sowell
January 14, 2003”

“As a percent of GDP the projected deficits are not that big. They are lousy at making projections anyway. They didn’t predict the short lived surplus. When the economy heats up who knows what will happen.

In my defense, if needed, I never said government has no roll in providing services. I just think there is a limit to want we should expect from the government. Some self reliance, family reliance and programs from voluntary collective groups (PC for Churches, etc.) can do a lot to reduce the need for government babysitting. Government is NOT a voluntary collective group.”

“Strat:
That's a pretty silly comment about an individual paying in extra taxes... as is the notion that lowering taxes is a moral issue (especially when it means later generations will have to pay more taxes). While I've glad to see that some people on the right have been abandoning the notion that lower taxes at this point is good for the economy (of course, there is a point at which levels of taxation can hurt) - but the moral argument is even sillier.

Is the Iraq war only OK because we borrowed the money and didn't raise taxes?

Is domestic spending that benefits people immoral while foreign spending isn't?

The constitution and its amendments provide for a democratic process by which levels of taxation and spending are set, or don't you buy into this whole notion about the consent of the governed?”

“"60K puts you into the top (roughly 75% of wage earners in the nation....you know how tom dashel says the tax cut are for the rich? well, if you make 60K, he's talkin about you...


don't get me started..."
stratdewd
09:23:14 PM
05/20/03

I respectfully and completely disagree with that statement. The tax cuts didn't do #&%!$ for people with $60K in income.”

“Seriously. $300 I got with the last tax cut? That's a trip to the grocery store...”

“It's $300 more than I got the years previous.”

“mtngal, you should run for president.. I'll be your campaign manager.”

“Warren Buffett is a commie.”

“I saw where Berkshire-Hathaway fell $90 yesterday... but you know each share costs over $73,000.

(and that's not a typo)”

“Dividend Voodoo
By Warren Buffett
The Washington Post
Tuesday, May 20, 2003”

“Thanks Tilt - that Buffett's got brains, common sense and some real honesty. I wish I'd bought into Berkshire Hathaway when I first looked at, but I sunk all my money into real estate and that's still where it all is (my house).”

“That was the original article I saw yesterday but didn't get a chance to post it. Then I looked for it today and came up with the other one, which is similar. Thanx for posting it though...”

“That was one heckuva line...

"Instead, give reductions to those who both need and will spend the money gained. Enact a Social Security tax "holiday" or give a flat-sum rebate to people with low incomes. Putting $1,000 in the pockets of 310,000 families with urgent needs is going to provide far more stimulus to the economy than putting the same $310 million in my pockets."

$1000 each to 310 THOUSAND families certainly puts it into perspective.”

“Would you rather have.........

inept government workers controlling your money and making decisions with your money that could effect thousands of jobs?

or............

Inept, greedy corporations getting the money so they can let it "trickle" down to you somehow.

Better yet, why don't you ask the 10 people that got laid off from one of my schools yesterday. Or ask the parents that now have to spend thier gas money, and time taking thier kids to school when they should be out looking for a job because they were laid off because some dolt that ran thier company cut jobs instead of dividends to save his own a$$.

A firend of mine just got laid off from a company. Instaed of the company laying off all, or most of the top managers, and trying to continue with a skeleton crew of people who could make the business grow, they decided to lay everyone else off, burn the rest of the investment monies, and pocket a salary while they were looking for other jobs.

Trickle down my a$$!”

“Last night, on the CBS news they had program about companies using overseas labor for service jobs. Not only are factory jobs going overseas, but now accounting, financial and other professional jobs can be done overseas for a fraction of what they pay people here. They said this ins the new trend. I guess all the immigrants wanting to come here might as well stay where they are to find a job.”

“well, that's enough politics for me in one day. i'm not gonna post an opinion, or anything, 'cause i have no clue what the hell you're all talking about.”

“"I'd rather keep all the money I earn, too. Who needs roads, schools, police, sewers or the military?"
mediaman

ok, how bout funding art? how bout layers of wastefull berocracy? how bout billions missing every year? how bout medicare fraud? how bout letting people choose what school they go to? funding planned parenthood? PBS? i could go on and on. highways and bombs and schools and fire/police are good. it's the BS that i have problems with...

chilie, look up WWW.irs.gov. all the numbers are there. i can provide furthur explanation if you'd like.


the first bush tax cut, like this one, was TINY. regan's tax cut was 10 times bigger than the one that just passed. it's really not enough. the first one, where EVERYONE got a $300 rebate wasn't enough to give the economy a real bump, especially after 9-11.

ped, moral grounds? democratic? well, since the bill passed democratically, you should have no problem with it. concent of the governed will be decided in '04. as it was in '00. as far as moral ground, iraq was national defence, one of the few things the constitution gives gubment the authority to do.

stikmanwalking, sowell ROCKS! i have read several of his books. that's guy's one smark cookie....

good post mtngal”

“More crackers than cookie....”

“"ped, moral grounds? democratic? well, since the bill passed democratically, you should have no problem with it. "

-stratdewd

Yeah, tell that to Senator Voinovich, who had to remove Carl Rove's foot from his a$$ before he was able to finally cast his "vote". I love how his own party attacked him, pretty much calling him a traitor and unpatriotic just because he, like the majority of Americans, didn't think a tax cut was a good idea right now.”