What a difference an election makes. NewsBusters has this little gem tucked away, and keep in mind this is a reason Bush scored low among us conservatives… he spent more and more on programs that need to be totally eradicated (like the Dept of Education):
MSNBC’s Chris Matthews and Andrea Mitchell have been telling viewers in recent days that Republicans considering blocking an increase in the debt ceiling could be creating a financial crisis.
Seven years ago after George W. Bush was re-elected and the debt ceiling had been raised in November 2004, the perilously liberal couple felt Republicans should be “embarrassed” for having done so (transcripts follow with commentary):
ANDREA MITCHELL: But what is looking over his shoulder is history. He wants a legacy. He wants to be able to do something about Social Security. He knows he’s got to do something about deficit reduction. That is the big embarrassment for Republicans. They ought to be ashamed of themselves, what the Hill Republicans have done. They’ve been worse than Democrats.
CHRIS MATTHEWS: They just increased the debt ceiling.
MITCHELL: Exactly.
This exchange occurred on the November 21, 2004, installment of “The Chris Matthews Show.”
Yet as NewsBusters has been reporting, Matthews has in the past several days twice referred to Republicans as terrorists because they’re refusing to support a raise in the debt ceiling if it includes tax increases.
President Obama was right about his audacity, if not always the hope. Six months after he agreed to a bipartisan extension of current tax rates, he is now insisting on tax increases as part of the debt-ceiling talks. At his press conference yesterday he repeated this demand, as well as his recent talking point that taxes are lower than they’ve been in generations. Let’s examine that claim because it explains Washington’s real revenue problem—slow economic growth.
Mr. Obama has a point that tax receipts are near historic lows, but the cause isn’t tax rates that are too low. As the nearby table shows, as recently as 2007 the current tax structure raised 18.5% of GDP in revenue, which is slightly above the modern historical average. Even in 2008, when the economy grew not at all, federal tax receipts still came in at 17.5% of the economy.
Today’s revenue problem is the result of the mediocre economic recovery. Tax collections in 2009 fell below 15% of GDP, the lowest level since 1950. But remarkably, tax receipts stayed that low even in the recovery year of 2010. So far this fiscal year tax receipts are growing at a healthy 10% clip, so the Congressional Budget Office (CBO) January estimate of 14.8% of GDP is probably low. We suspect revenues will be closer to 16%, but even that would be the weakest revenue rebound from any recession in 50 years, and far below the average tax take since 1970 of 18.2%.
But what about the liberal claim, repeated constantly, that the Bush tax cuts of 2001 and 2003 caused today’s deficits? CBO has shown this to be demonstrably false. On May 12, the budget arm of Congress examined the changes in its baseline projections from 2001 through 2011. In 2001, it had predicted a surplus in 2011 of $889 billion. Instead, it expects a deficit of $1.4 trillion.
What explains that $2.29 trillion budget reversal? Well, the direct revenue loss from the combination of the 2001 and 2003 Bush tax cuts contributed roughly $216 billion, or only about 9.5% of the $2.29 trillion. And keep in mind that even this low figure is based on a static revenue model that assumes almost no gains from faster economic growth.
After the Bush investment tax cuts of 2003, tax revenues were $786 billion higher in 2007 ($2.568 trillion) than they were in 2003 ($1.782 trillion), the biggest four-year increase in U.S. history. So as flawed as it is, the current tax code with a top personal income tax rate of 35% is clearly capable of generating big revenue gains.
CBO’s data show that by far the biggest change in its deficit forecast is the spending bonanza, with outlays in 2011 that are $1.135 trillion higher than the budget office estimated a decade ago. One-third of that is higher interest payments on the national debt, notwithstanding record low interest rates. But $523 billion is due to domestic spending increases, including defense, education, Medicaid and the Obama stimulus. Mr. Bush’s Medicare drug plan accounts for $53 billion of this unanticipated spending in 2011.
The other big revenue reductions come from the “temporary” tax changes of the Obama stimulus and 2010 bipartisan tax deal. CBO says the December tax deal—which includes the one-year payroll tax cut and the annual fix on the alternative minimum tax—will reduce revenues by $196 billion this year. The temporary speedup in business expensing will cost another $55 billion.
To put it simply though: we don’t have a tax revenue problem, we are spending way too much. The stats show this perfectly. In 2005 we generated $2.1 Trillion in taxes, and had $2.5 Trillion in federal spending. In 2010 we saw almost $3.5 Trillion in expenses, yet collected almost the same in taxes. These are official numbers from the White House, and not some partisan made up numbers.
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We are spending way too much than what we take in, and we need to cut the excess bloat in our government. We need a much flatter and simpler tax code than what we have currently. The solution is simple: we need to spend less than what we earn.
To say John Aravosis cannot respond coherently without childish “sweeping aside” arguments is an understatement. One site not supportive of Dennis’ views says this of John:
Aravosis opens with a ridiculous premise, saying that “whenever you have a political contest, and one side wins, they cover the victor.” Not only is that premise false, it papers over the relevant fact, that coverage of the Marriage Equality Act is a rare example of the media doing its job. The media’s coverage of Proposition 8 (which Prager correctly cites), and even more recently, the Citizens United Supreme Court decision, did not focus on the so-called “victors,” but on the negative consequences of each of them…. Aravosis opts for transparent straw-man arguments, bizarrely saying, at one point, that “Now, Dennis is talking about I’m trying to turn him into a woman.” (Media’ite)
Here is the whole segment in video form:
And here is Prager discussiong his appearance and taking calls on the subject:
*NOTE: I do not in any way believe in the absurd idea of banning ATM’s. If anything, the production, shipment, and maintenance of ATM’s create more jobs than those that are being ‘taken away’.* A couple weeks ago, Dan Joseph and I went out with a petition to “Ban Job Killing ATM’s” after President Obama said that technology, such as ATM’s and airport kiosks, have taken away jobs from some people when speaking about unemployment. For the most part, people either signed or kindly refused; except for one woman who annihilated me on the stupidity of the idea- and rightfully so.
A great insight and challenge to Liberal ideology (Townhall h/t):
(FT) ….I recently watched an overwhelmingly liberal audience at the Aspen Ideas Festival shift uncomfortably in its seats as Jonathan Haidt, a social psychologist at the University of Virginia, offered his own explanation. For several years Professor Haidt has probed what he calls the moral intuitions of liberals and conservatives. I find his conclusions compelling. It has come to this: you need a psychologist to make sense of US fiscal policy.
Prof Haidt finds that liberals are driven mainly by intuitions about fairness (who gets what) and harm to victims. Conservatives are guided by those intuitions too, but also by intuitions about loyalty, authority, and purity (including bodily purity). These are not views so much as deeply embedded moral impulses. They are often wrapped up in religion, or lack of it. Transgressing them is a kind of sacrilege.
In the US, differences in these moral-psychological foundations are very marked. The more progressive you are, the harder you find it to understand the claims of loyalty, authority and purity. The more conservative you are, the more indispensable those claims appear to be. This matters because US politics, especially at the conservative end, is powered by the energy at the extremes.
Why did the Aspen audience squirm? Because Prof Haidt also notes that the wider conservative spectrum of moral intuitions is the global norm. Those conservative impulses are nearly universal across world religions and cultures. Secular liberals are the anomaly…
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These need to start flowing in both directions, but since I write from progressive Aspen I will press the point on liberals. You express elaborate respect for foreign cultures and religions, despite the exalted place they give to loyalty, authority, and purity. You do not despise Muslims. You do not laugh at Buddhists. Difficult as it may be, try extending a little of that courtesy to your neighbours, even if they are evangelical Christians.
Hate and pressure at work from the left (Freep h/t):
At the Paris Las Vegas Hotel on Friday, Vice President Biden addressed a convention of the International Teamsters, telling the union members to vote Democratic next year.
“And don’t any of you, by the way, any of you guys vote Republican,” the garrulous Vice President started to say, after which he caught himself. “I’m not supposed to say, this isn’t political, I’m not supposed to say this.”
The crowd cheered him on.
“Guys!” Biden continued. “Let me put it this way! Don’t come to me if you do! You’re on your own, Jack!
At another point, the Vice President told the crowd, “Your logo is a horse’s head. Theirs should be the horse’s other end.”
The chief psychiatrist for California’s overcrowded prison system was paid $838,706 in 2010, more than any other state employee that year, payroll figures released today show.
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The figures show that the 10 highest-paid state employees each earned more than $500,000 in 2010, for a total of $6.2 million. All but three were doctors or dentists for the Corrections Department. Joe Dear, the chief investment officer at the California Public Employees Retirement System, ranked seventh with a gross pay of $548,142, the data show.
