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Politics : A US National Health Care System? -- Ignore unavailable to you. Want to Upgrade?

To: RetiredNow who wrote (14682)	3/17/2010 8:42:10 PM
From: TimF	Respond to of 42652

Lower taxes means lower tax revenues, unless business growth going gang busters. A better formulation would be that lower taxes result in lower revenues unless they increase economic activity to a sufficient degree. Growth can be poor, even negative, but as long as its increased (which would include a lower negative as an increase) the tax cut can increase revenue. OTOH growth can be going gang busters, but if the tax cut didn't contribute to it much, the slightly higher positive growth might not keep the tax cut from reducing revenue. (In fact if growth is going like gangbusters already the tax cut would be less likely to have enough of an effect on economic growth to avoid losing revenue) A simpler formulation would be that more often than not, at least when measured in the short to medium term (and tax rates don't stay steady for the long term) tax cuts decrease government revenue. None of those three formulations, yours or the two points I made, is an argument against the point I made earlier. Yes the tax cut has probably decreased revenue. But that hardly implies that either it was the main factor in deficit increases or that spending has not greatly increased, or that taxes have not been in a fairly steady range as a percentage of GDP, or that spending has not increased as a percentage of GDP, or that "you have the GOP cutting taxes so that our tax revenues dwindle to nothing" is not a silly statement (and a ridiculous one if meant literally), or that the (main) problem is the expansion of government, not tax cuts. All the points in that last paragraph are true. They are also totally consistent with the points at the beginning of this post. The fact is that both are proximate causes of our current deficits. That is probably true, but increased spending is a larger cause (and is definitely a cause rather than just almost definitely, but almost definitely is close enough for me to just accept the tax cuts as a cause, I'm not going to argue about such minute unrealistic chances). Its also true that high spending is a reason, while low taxes are not. Taxes where cut, but they are not low. I'm not just saying that compared to what I think taxes should be (although they should be lower in my opinion) but compared to the norm in terms of how much of the economy gets fed in to taxes, compared to the past). Revenue is (with the exception of the recessions affects, or counting from before the recession) at a normal historical level, and projected to exceed the normal level. Spending is beyond a normal historical level, and if changes are not made may reach double the normal historical level. (Not that I expect changes to be avoided, double the normal level is unrealistic IMO.) Spending is the problem, low taxes simply aren't the problem. That's true even if your only concerned about the fiscal balance. Its even more the case when you consider the long term health of the US economy, or if your concerned about things like individual liberty to any great degree.