Alexandria Ocasio-Cortez

[Canard DuJour]

Indeed, so if the economy gets stuck in a low-wage/low-productivity rut, direct fiscal stimulus can correct that. Several historical examples were given in the video link you've apparently edited out.

I agree that there are times injecting money into the economy is the right thing to do. That doesn't mean you can do that in general as a way of funding the government.

That is in general how monetary sovereign govts already spend, with taxation and interest rates controlling inflation. If you mean without controlling inflation, no one is suggesting that.

Meaning..?

GDP grows on average a bit over 2%/year. Federal tax revenue is a bit over 20% of GDP/year. Thus if you want to fund the government with only what you can inject without causing harm you need to cut out 90% of government spending.

Not even 2% since the crash. Yet GDP growth averaged about twice that back back in pre-neoliberal days when central banks prioritised full employment. The New Deal, combined with the deficit spending of WWII, resulted in the greatest, most widespread burst of growth, progress and prosperity in American history — before or since. Pretty much the same happened across the OECD with GDP growth averaging >4% per year in the 1950s, and nearly 5% in the 1960s, compared with 3% in the 1970s and 2% (if that) since the 1980s.

To spend more than that you have to take it back out of the economy somehow.

Fine. Tax, raise interest rates or cut spending as and when inflation kicks in. Don't hamstring the economy with an artificial scarcity of money just because some people don't like public spending.

I note your first option is tax--but this was being presented as an alternative to tax!

On the contrary, taxes do not fund federal govt spending in the first place.

As for raising interest rates, that's not going to do any good. Raising interest rates is about slowing the rate money moves around and thus lowering the effective money supply.

Then it is indeed, as I said, a means of controlling inflation. Do try to maintain context.

To overcome this huge injection of cash you'll have to raise them a lot every year. Pretty soon nobody will borrow and your control breaks.

Even if govt "borrowing" were dependent on credit markets - which it isn't - this would make no sense at all.

And we aren't hamstringing the economy. We are trying to keep it going smoothly--the supply of money matches the goods & services available so prices stay stable. What you seem to be advocating (accepting inflation to boost the economy) was already tried--and we got stagflation. The gains are short term, the pain doesn't go away nearly so easily.

On the contrary, you got decades of boom, then stagflation which was short term and had as much to do with geopolitical oil shocks as wage/price spirals. We now have the opposite problem.

 

[T.G.G. Moogly]

Your argument is self defeating. If the rich were charged only for the public services they consume their taxes would be _substantially_ lower.

Not at all. Every bit of infrastructure in this country can be logically and proportionally attributed to the relative wealth that it sustains and protects. If it isn't doing that then what is it doing?

I'm not arguing to make rich people poor, which seems to be the bent that most people take. They are still going to be wealthy, they will simply be paying their fair share of taxes relative to that wealth.

Really? Then you believe that the government should not allow Mark Zuckerberg to retain his shares of facebook? You do know that his massive wealth is overwhelmingly his ownership of facebook don't you? And what do you think the government should do with facebook once they confiscate or nationalize it?

What exactly is the point of this line of question? Who is saying to nationalize anything? Are you simply disagreeing with the fact that taxation should reflect wealth, and that there is some better formula out there? If so, what is your proposal?

 

[Harry Bosch]

Really? Then you believe that the government should not allow Mark Zuckerberg to retain his shares of facebook? You do know that his massive wealth is overwhelmingly his ownership of facebook don't you? And what do you think the government should do with facebook once they confiscate or nationalize it?

What exactly is the point of this line of question? Who is saying to nationalize anything? Are you simply disagreeing with the fact that taxation should reflect wealth, and that there is some better formula out there? If so, what is your proposal?

Pretty simple: tax cash flow. Wealth doesn't equal cash. The value of an asset is the estimated cash value at a particular time non distressed. If you force people to sell their assets, values will plummet since they are distressed. Secondly you'll hurt companies who need equity in them to grow. You'll discourage increasing company value.

 

[T.G.G. Moogly]

Really? Then you believe that the government should not allow Mark Zuckerberg to retain his shares of facebook? You do know that his massive wealth is overwhelmingly his ownership of facebook don't you? And what do you think the government should do with facebook once they confiscate or nationalize it?

What exactly is the point of this line of question? Who is saying to nationalize anything? Are you simply disagreeing with the fact that taxation should reflect wealth, and that there is some better formula out there? If so, what is your proposal?

Pretty simple: tax cash flow. Wealth doesn't equal cash. The value of an asset is the estimated cash value at a particular time non distressed. If you force people to sell their assets, values will plummet since they are distressed. Secondly you'll hurt companies who need equity in them to grow. You'll discourage increasing company value.

That works fine if you do it at a given rate and do not have exemptions.

 

[Harry Bosch]

Pretty simple: tax cash flow. Wealth doesn't equal cash. The value of an asset is the estimated cash value at a particular time non distressed. If you force people to sell their assets, values will plummet since they are distressed. Secondly you'll hurt companies who need equity in them to grow. You'll discourage increasing company value.

That works fine if you do it at a given rate and do not have exemptions.

Well, politicians add exemptions over time in order to encourage behavior. For example: home ownership, child raising, economic development, saving for retirement, donations for charity, are all exemptions added by politicians to encourage behavior. Barring exemptions, what do you think the tax rate should be?

 

[skepticalbip]

Really? Then you believe that the government should not allow Mark Zuckerberg to retain his shares of facebook? You do know that his massive wealth is overwhelmingly his ownership of facebook don't you? And what do you think the government should do with facebook once they confiscate or nationalize it?

What exactly is the point of this line of question?

It is an attempt to make you think of the consequences if your taxation ideas were made law.

Who is saying to nationalize anything?

Do you realize that facebook value is in the neighborhood of seventy billion dollars. A 10% wealth tax would mean that Zuckerberg would need to come up with seven billion dollars to pay his wealth tax. The only way he could do such a thing is to sell some of his facebook stock (or some deal to transfer 10% of it to the government). Even 1% wealth tax (seven hundred million dollars) would be beyond his ability to pay without selling or transferring stock to the government. Next year he would face the same problem.

Also you would be obligated to pay the federal government a percentage of the value of all your assets (home, auto, Ira acct. savings acct. etc) every year in addition to any state or county ad valorem taxes you are currently paying.

Are you simply disagreeing with the fact that taxation should reflect wealth, and that there is some better formula out there?

Yes

If so, what is your proposal?

I personally prefer a tax on consumption rather than on wealth generation. I kinda like the tax proposal spelled out in H.R.25.

 

[T.G.G. Moogly]

Pretty simple: tax cash flow. Wealth doesn't equal cash. The value of an asset is the estimated cash value at a particular time non distressed. If you force people to sell their assets, values will plummet since they are distressed. Secondly you'll hurt companies who need equity in them to grow. You'll discourage increasing company value.

That works fine if you do it at a given rate and do not have exemptions.

Well, politicians add exemptions over time in order to encourage behavior. For example: home ownership, child raising, economic development, saving for retirement, donations for charity, are all exemptions added by politicians to encourage behavior. Barring exemptions, what do you think the tax rate should be?

I do not know what the tax rate should be. My concern is that at a time of decent economic activity we have trillion dollar budget deficits. Is that a sustainable long term behavior?

 

[Harry Bosch]

Well, politicians add exemptions over time in order to encourage behavior. For example: home ownership, child raising, economic development, saving for retirement, donations for charity, are all exemptions added by politicians to encourage behavior. Barring exemptions, what do you think the tax rate should be?

I do not know what the tax rate should be. My concern is that at a time of decent economic activity we have trillion dollar budget deficits. Is that a sustainable long term behavior?

I don't know. I think that we're hosed. I listened to a Harvard economics professor make the case that if we raised the tax rates on the rich as recommended by AOC, taxes would go up about 30 billion. However, this assumes zero flight to other countries or cheating. But 30 billion is a drop in the bucket compared to the trillion dollar deficit.

 

[Trausti]

Well, politicians add exemptions over time in order to encourage behavior. For example: home ownership, child raising, economic development, saving for retirement, donations for charity, are all exemptions added by politicians to encourage behavior. Barring exemptions, what do you think the tax rate should be?

I do not know what the tax rate should be. My concern is that at a time of decent economic activity we have trillion dollar budget deficits. Is that a sustainable long term behavior?

Perhaps we can cut spending to avoid deficits. Like normal people would. Nah. Crazy talk.

 

[poster]

Well, politicians add exemptions over time in order to encourage behavior. For example: home ownership, child raising, economic development, saving for retirement, donations for charity, are all exemptions added by politicians to encourage behavior. Barring exemptions, what do you think the tax rate should be?

I do not know what the tax rate should be. My concern is that at a time of decent economic activity we have trillion dollar budget deficits. Is that a sustainable long term behavior?

Perhaps we can cut spending to avoid deficits. Like normal people would. Nah. Crazy talk.

Where do you propose we do that?



https://www.nationalpriorities.org/budget-basics/federal-budget-101/spending/

 

[skepticalbip]

Perhaps we can cut spending to avoid deficits. Like normal people would. Nah. Crazy talk.

Where do you propose we do that?

View attachment 19805

https://www.nationalpriorities.org/budget-basics/federal-budget-101/spending/

Your pie chart is only the funds in what Congress has decided to call discretionary, and I doubt its accuracy at that. Actual budget gives a much different impression of where the money is spent.

From politifact.com:
https://www.politifact.com/truth-o-meter/statements/2015/aug/17/facebook-posts/pie-chart-federal-spending-circulating-internet-mi/

 

[Cheerful Charlie]

Well, politicians add exemptions over time in order to encourage behavior. For example: home ownership, child raising, economic development, saving for retirement, donations for charity, are all exemptions added by politicians to encourage behavior. Barring exemptions, what do you think the tax rate should be?

I do not know what the tax rate should be. My concern is that at a time of decent economic activity we have trillion dollar budget deficits. Is that a sustainable long term behavior?

Perhaps we can cut spending to avoid deficits. Like normal people would. Nah. Crazy talk.

Or perhaps our right wingers in Congress could stop with the massive tax cuts to the rich that cause these vast deficits. Bush's tax cuts and his lovely war in Iraq. Bush doubled the national debt. With help from a GOP congress. Obama spent his time in office digging us out of the Bush hole as best he could with an obstructionist GOP Congress. Now we are back to big tax cuts and trillion dollar a year deficits. And Trump has recently said he wants even more big tax cuts.

How does the old saying go? When you in a hole, stop digging.
In a lower pit in hell, Ayn Rand smirks.

 

[poster]

Not that it matters but the mandatory spending can't be cut, can it? If that's true then the discretionary spending chart would be the relevant one. No? Isn't that what discretionary spending means?

The best way to fix the problem is through taxes.

 

[Cheerful Charlie]

Not that it matters but the mandatory spending can't be cut, can it? If that's true then the discretionary spending chart would be the relevant one. No? Isn't that what discretionary spending means?

The best way to fix the problem is through taxes.

Social Security and medicare are funded separately. Congress has been raiding SS funds for years, rather than investing surpluses as was the plan under Sen. Patrick Moynihan.

 

[T.G.G. Moogly]

Well, politicians add exemptions over time in order to encourage behavior. For example: home ownership, child raising, economic development, saving for retirement, donations for charity, are all exemptions added by politicians to encourage behavior. Barring exemptions, what do you think the tax rate should be?

I do not know what the tax rate should be. My concern is that at a time of decent economic activity we have trillion dollar budget deficits. Is that a sustainable long term behavior?

Perhaps we can cut spending to avoid deficits. Like normal people would. Nah. Crazy talk.

Left wing as I am I am certainly on board with that.

No one seems willing to address the point I'm attempting to make about wealth and taxes being in relation. Does everyone here simply disagree with me that wealth and taxes are not related?

I live in a home where I pay property taxes. I've never lived in a home in five different states where I did not pay property taxes based on the value of my property. Can someone tell me how that is not a wealth tax?

 

[skepticalbip]

Not that it matters but the mandatory spending can't be cut, can it? If that's true then the discretionary spending chart would be the relevant one. No? Isn't that what discretionary spending means?

Mandatory as applicable to the budget is so only because politicians decided it was so. They can easily change, or eliminate the category the same way they created it, by vote.

But beside that, you chart is not accurate even for that category. It was made up and does not reflect the actual budget. It is part of what is called a propaganda piece.

The best way to fix the problem is through taxes.

The best way to fix the problem is through responsible legislation. 'More taxes and more spending' is not always the answer.

 

[poster]

Not that it matters but the mandatory spending can't be cut, can it? If that's true then the discretionary spending chart would be the relevant one. No? Isn't that what discretionary spending means?

Mandatory as applicable to the budget is so only because politicians decided it was so. They can easily change, or eliminate the category the same way they created it, by vote.

But beside that, you chart is not accurate even for that category. It was made up and does not reflect the actual budget. It is part of what is called a propaganda piece.

The best way to fix the problem is through taxes.

The best way to fix the problem is through responsible legislation. 'More taxes and more spending' is not always the answer.

You'll point me to the proper discretionary spending chart then? I'll wait.

I notice both you and your buddy are doing everything but answering the question of where to cut the spending that the two of you say needs to happen.

 

[RVonse]

I live in a home where I pay property taxes. I've never lived in a home in five different states where I did not pay property taxes based on the value of my property. Can someone tell me how that is not a wealth tax?

You haven't owned a home in California where there is proposition 13 then. There are lots of senior citizens paying little tax on $millions worth of property simply due to sitting there a long length of time. Property tax is based more on seniority than the value of the house for those people.

Example: An original owner of a $1 million house built in 1965 would be paying around $1500 tax. If he sells and moves out, the next owner will pay close to $10k tax living in the same house.

 

[lpetrich]

Perhaps we can cut spending to avoid deficits. Like normal people would. Nah. Crazy talk.

Like spending on military adventures?

I ask that because I'd like to see if right-wing professional pennypinchers are willing to endorse pinching pennies on their favorite things.

 

[Cheerful Charlie]

Perhaps we can cut spending to avoid deficits. Like normal people would. Nah. Crazy talk.

Like spending on military adventures?

I ask that because I'd like to see if right-wing professional pennypinchers are willing to endorse pinching pennies on their favorite things.

These right winged louts want to cut spending on foreign aid, EPA, education etc. Remember Rick Perry's campaign? Of course they want to cut regulations. Our national nightmare of clean water, air and food will finally be over. Every year, the GAO ritually asks the Defense Department to submit their records for federally mandated auditing. Every year the Defense Department ritually declares they haven't any records to submit for audit, which the GAO ritually submits as to why there was no audit, again, to the US Congress. This has been going on for years and years. The GOP deficit hawks don't care.