Kansas was supposed to be the GOP’s tax-cut paradise. Now it can barely pay its bills.

[boneyard bill]

Total Taxation = Total Spending

Only a conservative can think that by cutting direct taxes without corresponding spending cuts would work. If you want to cut taxes - really cut taxes - spending has to go down too.

Actually, the groups that praised these policies are also ignorant of supply-side economics. While supply-siders do argue that selective tax cuts can, if the rates are high enough, increase revenue, for example, capital gains; they do not argue that across the board tax cut will do that. When Jack Kemp argued that Reagan's tax cuts would be "self-financing," he did not claim that they would reduce the deficit. He claimed that the low rates would generate some additional revenue beyond static scoring, but that they would also generate additional revenue that could be borrowed. In other words, he was claiming that the tax cuts would not be inflationary, not that they wouldn't add to the deficit. Of course, a point like that is way, way too subtle for our moronic media to comprehend so the public was sold a very different story, and Reagan was excoriated for breaking Republican orthodoxy with his budget deficits despite eight years of deficits under Nixon and Ford.

 

[boneyard bill]

Actually Reagan didn't cut taxes.

While the top rate went way down he also closed an awful lot of loopholes and the like. (It really clobbered commercial real estate because prices were bid up due to transactions whose benefit was tax writeoffs. Those went away, prices adjusted.) The total tax take was about the same.

Interesting. Is this why annual revenues under Carter increased an average of nearly 15%, while under Reagan it was half of that?

No. Annual revenues increased so heavily under Carter because we had 18% inflation and the progressive income tax was not indexed for inflation. In addition to cutting inflation, Reagan also indexed taxes to the inflation rate so people who received a cost of living raise did not end up in a higher income bracket.

 

[boneyard bill]

Clearly Brownback needs to look to California, Illinois, and New Jersey. These three high-tax states are the only ones who have a credit rating of less than AA. This doesn't suggest high taxes are the answer, fiscal restraint is required but it is best to apply it BEFORE cutting taxes.

 

[Cheerful Charlie]

Interesting. Is this why annual revenues under Carter increased an average of nearly 15%, while under Reagan it was half of that?

No. Annual revenues increased so heavily under Carter because we had 18% inflation and the progressive income tax was not indexed for inflation. In addition to cutting inflation, Reagan also indexed taxes to the inflation rate so people who received a cost of living raise did not end up in a higher income bracket.

True. But it doomed Reaganomics. David Stockman admitted later Reaganomics worked only on paper because of inflation and lack of indexing. It was Dole's TEFRA $500 billion tax raise that prevented Reagan's deficits from being even larger. And Paul Volker's crushing out inflation with high interest rates cut the "conveyer belt" of money to the government.

 

[Jimmy Higgins]

Interesting. Is this why annual revenues under Carter increased an average of nearly 15%, while under Reagan it was half of that?

No. Annual revenues increased so heavily under Carter because we had 18% inflation and the progressive income tax was not indexed for inflation. In addition to cutting inflation...

Reagan cut inflation? Did he sign legislation that said inflation must be cut?

Reagan also indexed taxes to the inflation rate so people who received a cost of living raise did not end up in a higher income bracket.

So where is the presentation that the tax revenue change was neutral between Carter and Reagan?

 

[ksen]

Clearly Brownback needs to look to California, Illinois, and New Jersey. These three high-tax states are the only ones who have a credit rating of less than AA. This doesn't suggest high taxes are the answer, fiscal restraint is required but it is best to apply it BEFORE cutting taxes.

Fiscal restraint kills economies.

 

[Bronzeage]

Total Taxation = Total Spending

Only a conservative can think that by cutting direct taxes without corresponding spending cuts would work. If you want to cut taxes - really cut taxes - spending has to go down too.

It should be noted that some taxes that are spent by Government help generate additional revenue, so if you cut some taxes and spending evenly, that doesn't mean you break back even.

Unless you mean things such as an educational system which produce wage earners in a higher tax bracket or an infrastructure which reduces obstacles to commerce, the government should be concerned with paying for the services it provides, not spending capital in order to return a profit on investment.

 

[laughing dog]

It should be noted that some taxes that are spent byvernment help generate additional revenue, so if you cut some taxes and spending evenly, that doesn't mean you break back even.

Unless you mean things such as an educational system which produce wage earners in a higher tax bracket or an infrastructure which reduces obstacles to commerce, the government should be concerned with paying for the services it provides, not spending capital in order to return a profit on investment.

It is simpler than that. Suppose the gov't hires a contractor to install a door for $200 (door included). The contractor pays her distributor for the door, her worker for the installation and she keeps a bit as income. The distributor earns a profit on the sale of the door. All 3 end up paying some tax on their profit or wages back to the government.

 

[Jimmy Higgins]

Unless you mean things such as an educational system which produce wage earners in a higher tax bracket or an infrastructure which reduces obstacles to commerce, the government should be concerned with paying for the services it provides, not spending capital in order to return a profit on investment.

It is simpler than that. Suppose the gov't hires a contractor to install a door for $200 (door included). The contractor pays her distributor for the door, her worker for the installation and she keeps a bit as income. The distributor earns a profit on the sale of the door. All 3 end up paying some tax on their profit or wages back to the government.

IE, most of the money went into the economy. Money comes back via taxation.

Cut spending enough, and certain things dry up. Take a city that lays off people. All of that money they were being paid is no longer entering directly into the local economy. That has direct affects on the entire system which can drain more tax revenue than you cut in spending. The Government shouldn't be in business to make money, but Government spending can help to improve the economy which then can increase tax revenues.

 

[ksen]

UPDATE:

Why 104 Kansas Republicans just endorsed a Democrat for governor

probably weren't real republicans anyways

 

[ksen]

It is simpler than that. Suppose the gov't hires a contractor to install a door for $200 (door included). The contractor pays her distributor for the door, her worker for the installation and she keeps a bit as income. The distributor earns a profit on the sale of the door. All 3 end up paying some tax on their profit or wages back to the government.

IE, most of the money went into the economy. Money comes back via taxation.

Cut spending enough, and certain things dry up. Take a city that lays off people. All of that money they were being paid is no longer entering directly into the local economy. That has direct affects on the entire system which can drain more tax revenue than you cut in spending. The Government shouldn't be in business to make money, but Government spending can help to improve the economy which then can increase tax revenues.

Especially in an economy starving for demand . . . like ours is at the moment.

 

[Bronzeage]

Unless you mean things such as an educational system which produce wage earners in a higher tax bracket or an infrastructure which reduces obstacles to commerce, the government should be concerned with paying for the services it provides, not spending capital in order to return a profit on investment.

It is simpler than that. Suppose the gov't hires a contractor to install a door for $200 (door included). The contractor pays her distributor for the door, her worker for the installation and she keeps a bit as income. The distributor earns a profit on the sale of the door. All 3 end up paying some tax on their profit or wages back to the government.

That is actually quite complicated.

Wouldn't be more efficient for the government to buy the door and pay someone to install it? What you describe is a poker game where the players start with the same amount of chips. They play a few hands and dealer takes a 10% tip. The money has been redistributed a little, but no wealth has been created.

 

[Nice Squirrel]

Guess which polling company has Brownback ahead by 7 points.

Hint: Starts with "Rass"

http://www.realclearpolitics.com/ep.../kansas_governor_brownback_vs_davis-4146.html

 

[Jimmy Higgins]

UPDATE:

Why 104 Kansas Republicans just endorsed a "Democrat" for governor

probably weren't real republicans anyways

FIFY

- - - Updated - - -

Guess which polling company has Brownback ahead by 7 points.

Hint: Starts with "Rass"

http://www.realclearpolitics.com/ep.../kansas_governor_brownback_vs_davis-4146.html

They did pretty well with the 2012 election. Got well over two-thirds of states correct like Alabama, Mississippi, North/South Dakota, even Alaska!

 

[ksen]

Guess which polling company has Brownback ahead by 7 points.

Hint: Starts with "Rass"

http://www.realclearpolitics.com/ep.../kansas_governor_brownback_vs_davis-4146.html

You know you can't spell "Rassmussen" without

Show

"smus"

 

[Shadowy Man]

"Governor Brownback came in here with an agenda to reduce the size of government, reduce taxes, and create a great economic boom," says University of Kansas professor Burdett Loomis.

I would think most would consider it quite a thing for a politician to actually achieve 66% of his agenda.

 

[Loren Pechtel]

Clearly Brownback needs to look to California, Illinois, and New Jersey. These three high-tax states are the only ones who have a credit rating of less than AA. This doesn't suggest high taxes are the answer, fiscal restraint is required but it is best to apply it BEFORE cutting taxes.

Fiscal restraint kills economies.

The economies that really get killed die by excess spending, not fiscal restraint.

 

[Nice Squirrel]

Fiscal restraint kills economies.

The economies that really get killed die by excess spending, not fiscal restraint.

Do you have an example? (This should be quite easy.)

 

[Jimmy Higgins]

Fiscal restraint kills economies.

The economies that really get killed die by excess spending, not fiscal restraint.

I seem to remember our economy getting gutted by reckless finance corporation policies. It was some attempts at raising spending (which was deficit spending because revenues dropped like a rock) that appeared to help the US economy.

I know a few engineering jobs at my company were saved directly from the Stimulus related to a more aggressive schedule for the national levee inspection program (something that needed to be done anyway in the US in response to the lackluster performance of the New Orleans flood protection systems).

 

[Bronzeage]

The economies that really get killed die by excess spending, not fiscal restraint.

I seem to remember our economy getting gutted by reckless finance corporation policies. It was some attempts at raising spending (which was deficit spending because revenues dropped like a rock) that appeared to help the US economy.

I know a few engineering jobs at my company were saved directly from the Stimulus related to a more aggressive schedule for the national levee inspection program (something that needed to be done anyway in the US in response to the lackluster performance of the New Orleans flood protection systems).

Our last financial meltdown was created when corporations found a scheme to take profits from investments before the profits were actually realized, mortgage backed securities, derivatives, and the lot.

If you want to see a nation ruined by excess spending, look to Greece. Their government is too weak to effectively collect taxes, so tax evasion is the cultural norm. The citizens still demand government services, so the Greek government borrowed money to make up the difference. The Greek's problem was not lack of fiscal restraint, it was trying to satisfy a nation that wants to have cake and eat it, too.