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Politics : Formerly About Advanced Micro Devices -- Ignore unavailable to you. Want to Upgrade?

To: Road Walker who wrote (226342)	3/25/2005 8:38:53 PM
From: TimF	Read Replies (1) \| Respond to of 1572751

Even talking about something as "static analysis" only makes sense in the context of a situation where a proposed change could bring changes in behavior. You raise tax rates and if you don't consider the "side effects" you get extra revenue. If you do consider the effect on economic activity you might still get extra revenue but you might not. Raise them high enough and you are just about certain to get a decline in revenue. I never said "look at the static numbers, the rich paid less". I did say the rich pay more in taxes now than they did in the recent past. Calling that static analysis is silly because 1 - It shows and actual historical change, it is not a projection based on static analysis, or any sort of projection at all. and 2 - To the extent you do project the idea in the future and actually perform a estimate of future results it is a projection based on dynamic analysis. Static analysis would seem to show that tax cuts make the rich pay a lower percentage of the total income tax revenue in the future, when in fact tax cuts often result in the rich paying a higher percentage of future taxes. It is an uncontroversial economic proposition that tax cuts tend to increase economic growth. Beyond some threshold they probably don't, if you don't have roads, and a court system and police to keep the peace than your economy will probably suffer but we are well above that threshold. Deficits can reduce economic growth by putting pressure on interest rates, but interest rates are still low. To this point the tax cuts have almost certainly increased economic growth. If we could lower taxes even more without the deficit getting out of control it would help the economy even more, but as you are fond of pointing out under Bush we have had no real control of spending. Right here, right now, the biggest problem this country has to face is the budget deficit. It's huge, it's Argentina. No. Its too big but it isn't out of line with other countries or with our deficit historically (as a % of GDP). Argentina's debt level is much higher. ----------- "The French public deficit came to 3.7 percent of gross domestic product in 2004 after 4.2 percent in 2003 Germany ran up a public deficit equivalent to 3.7 percent of gross domestic product in 2004, exceeding EU limits for the third year in a row U.S. Fiscal Year 2004 ended on September 30, and today the Treasury Department reported that the deficit for 2004 was $413 billion, or 3.6 percent of Gross Domestic Product" tblog.com In 2004 the largest government deficits in percentage of GDP were recorded by Greece (-6.1%), Malta (-5.2%), Poland (-4.8%), Hungary (-4.5%) and Cyprus (-4.2%), Germany (-3.7%). finfacts.com ---------- The US level of debt as a percentage of GDP is currently lower than in a number of European countries, and is also lower than it was in 6 of Clinton's 8 years (and 2 of Bush Sr's 4). US debt has increased about the same percentage under Clinton as it has under Bush. This reflects favorably on Clinton compared to Bush because Clinton had two full terms while the data for Bush are for one term, however it does show that its not a case of Clinton being a wonderful fiscal conservative that got our debt in line while Bush is blowing it out to third world levels. -------- Looking at EU countries Belgium, Germany, Greece, France, Italy, and Cyprus all have a higher level of debt compared to their GDP than we do. (EU debt data at) finfacts.com

To: Road Walker who wrote (226342)	3/25/2005 8:46:10 PM
From: TimF	Respond to of 1572751

Defense spending and deficit spending under Bush It is important to put the current budget proposal into historical context. To do so, it is necessary to translate current spending and revenue proposals into real terms either by adjusting for inflation or by expressing the proposal in terms of the broader economy. Looking merely at the budget in nominal terms that do not account for inflation or economic growth is misleading and inaccurate. The table below contains information about the current budget in the context of the post-World War II era and the past three administrations. Highlights include: * The President’s budget proposes spending $390.4 billion on defense related activities in FY 2004. This amounts to 17.5 percent of all spending and 3.5 percent of GDP. -This level is roughly the same as defense spending was in 1996, which amounted to 17.0 percent of all federal spending and 3.5 percent of GDP. -Defense spending in 1987, the height of the Reagan build up, was 28.1 percent of all federal spending and 6.1 percent of GDP. * The President’s budget proposes a fiscal year 2004 budget deficit of $307.4 billion, which is 13.8 percent of all spending and 2.8 percent of GDP. -This level is roughly the same as the deficit was in 1994, which amounted to 13.9 percent of all spending and 2.9 percent of GDP. -Deficit spending in 1983, the highest point during the Reagan administration, was 25.7 percent of all spending and 6.0 percent of GDP. Defence spending as a % of total outlays GW Bush 17.5% Clinton 17.1% GHW Bush 21.7% Reagan 26.7% Post-WWII Average 35.5% taxfoundation.org