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Politics : American Presidential Politics and foreign affairs -- Ignore unavailable to you. Want to Upgrade?

To: DuckTapeSunroof who wrote (42614)	4/6/2010 12:09:12 PM
From: TimF	Read Replies (1) \| Respond to of 71588

It may have gone up off the baseline, the problem is we can never really know what the baseline is. When I say baseline I'm not talking about the revenue projections, but actually what the revenue would have been. We can only guess at that. We can say that if you assume the economy will grow the same amount, and that people will avoid taxes by the same amount, that lower rates will reduce revenue. But tax cuts tend to increase the amount of economic growth you get (in the short run you can get a stimulus effect, in the long run you get a supply side benefit, that might be smaller per year, but is more reliably and durable), and they also tend to decrease the incentive to evade or avoid taxation. But making an educated guess I would say that reducing the top rate from 70% increased revenue, even when considered in isolation and esp. when you consider that it was combined with closing tax loopholes. Overall the tax cut probably decreased revenue, if your measuring its impact during the Reagan administration. The cuts from the lower rates where on the left side of the Laffer curve. Looking even further out though I think the cuts from 70% where important for economic growth we had in the 80s and the 90s, and while the taxes where changed the top tax rate was left well below 70%. There is a good chance that in this time frame revenue was actually increased. (And even if it wasn't maximizing revenue should not be our primary concern.) With the Bush II tax cuts you started from a much lower level of top marginal tax rates, and the cuts didn't come with reform/simplification. While its impossible to be totally sure, its likely that the tax cuts cut revenue (just not by as much as the static estimates of the tax changes would lead people to believe). But again maximizing revenue shouldn't be the number one concern, and I'm glad the taxes where cut, and do not want to see them raised to pre-Bush levels.

To: DuckTapeSunroof who wrote (42614)	4/6/2010 2:28:26 PM
From: TimF	Respond to of 71588

Is the Obama Mortgage Foreclosure Plan Legal? Posted by Mark A. Calabria While considerable attention has rightly focused on the failure of President Obama’s various mortgage foreclosure plans to actually lower the rate of foreclosures, few have bothered to even ask whether the plan is allowable under the TARP statute. Alex Pollock at AEI first raised this issue during testimony before the Congressional Oversight Panel. Alex’s point is that TARP only allows the modification of mortgages that are actually acquired by the government. Recall the original purpose of the TARP was to buy “troubled assets.” In managing those assets, Congress required the executive branch to come up with a plan to assist the borrowers behind those troubled assets. Apparently unlike the Treasury department, I believe we should go back to the language of the statute in determining what it allows and doesn’t allow. Section 110(b)(1) is quite clear: “to the extent that the Federal property manager holds, owns, or controls mortgages, mortgage backed securities…” Nowhere else in TARP is there any other ability to establish a mortgage modification program. In using TARP funds to pay for modifications of loans not owned by the federal government, the Obama administration is acting far outside of its legal authority under TARP. Many, including myself, have criticized the TARP as a massive delegation of spending power from Congress to the Treasury Department. Such delegation is, in my mind, clearly unconstitutional. However, even within such a broad delegation, there are parameters in which Treasury must act. Treating TARP as simply a large pot of money to spend however Treasury chooses is nothing short of illegal. cato-at-liberty.org