American Politics

[Tiny 12]

Errata, Post 10456

The labor force participation rate increased from 62.7% in January, 2018 to 63.4% in February, 2020.

Estimates were that the TCJA would reduce government revenues by 1.5 trillion.

I'm not able to link to Peter Whiteford's comments in Greg Mankiw's blog. Either replace the asterisks below with "b l o g s p o t", or Google Mankiw and Whiteford to read the piece.

http://gregmankiw.********.com/2011/...ssive-tax.html

[PVMonger]

Damn it Tooms, I'm trying to cut back on posting here. But you're making it hard. Real hard.

They don't want you to look at the details, as long as you believe "Democrat Good, Republican Bad", they're happy.

Aaagh! The TCJA took effect on January 1, 2018. Employment grew by 2. 7 million in 2018 and 2. 1 million 2019. Then COVID hit. If I may be allowed to cherry pick, like you and your left of center media sources do, the average growth per year in employment during Obama's administration was 1. 4 million.

https://www.bls.gov/opub/mlr/2019/ar...es-in-2018.htm#text=According%20 to%20 data%20 from%20 the, monthly%20 gain%20 of%20223%2 C000%20 jobs.

https://www.bls.gov/opub/mlr/2020/ar...industries.htm#text=In%202019%2 C%20 total%20 nonfarm%20 payroll, the%20 Current%20 Employment%20 Statistics%20 survey.

https://fred.stlouisfed.org/series/PAYEMS

And in 2018 and 2019, the USA, as described in post #10452, we were inching closer and closer to full employment in 2018 and 2019. Finally as described in posts 10377 and the link in #10381, the demographic wind was at our back in the final years of Obama's administration. The working aged population, 18 to 64, increased by 2. 3 million from 2013 to 2016, the last 3 years of Obama's administration, versus 270,000 from 2017 to 2020.

https://www.bls.gov/opub/mlr/2019/ar...es-in-2018.htm#text=According%20 to%20 data%20 from%20 the, monthly%20 gain%20 of%20223%2 C000%20 jobs.

https://www.bls.gov/opub/mlr/2020/ar...industries.htm#text=In%202019%2 C%20 total%20 nonfarm%20 payroll, the%20 Current%20 Employment%20 Statistics%20 survey.

https://fred.stlouisfed.org/series/PAYEMS

Finally, the labor force participation rate fell like a rock for the first 6 years of the Obama administration, prior to flattening in 2015. After the TCJA took effect, it kicked up, from 62.7% in January, 2017 to 63.4% in January, 2020, before COVID hit.

https://fred.stlouisfed.org/series/CIVPART

We've already discussed GDP growth rate, and I've listed some of the factors like globalization, changes in technology, the business cycle, a pandemic, what's going on in China and the rest of the world, Congress, that are as important or more important than who's president. And provided links that show the increase in real growth in median wages and median household income was off the charts, compared to past years, in 2019.

You're just rehashing what we've already discussed. You have to assume all provisions of the TCJA will be extended to get to "trillions of dollars. " Estimates were that the TCJA would reduce government revenues by $1. 5 million. So far the amount has likely been under $1 trillion, maybe half of what the Democrats' American Rescue Plan cost in 2021 alone. The Democrats control the presidency, the Senate and the House, and they haven't repealed the TCJA. I believe Democrats should receive at least part of the credit and praise for any revenue losses after January 21,2021 from the corporate tax cuts. Biden BTW only wanted to increase the corporate rate back to 28%.

PLEASE!! The closer you get to full employment, the harder it is to reduce the unemployment rate.

I'm all for tax cuts, if the politicians will also reduce the spending, which they didn't during Trumps' term. However, I don't have an argument with what you're saying. The TCJA didn't reduce the complexity of the tax code. The one part of the TCJA I heartily approve of are changes in the corporate tax. They hurt me (and helped you), but still, they were so clearly needed I don't see why you feel compelled to argue against them. As to the QBI deduction for pass throughs and cuts in individual rates, there are valid arguments for and against them.

It's not 1932 any more. Republicans are just as inclined to use Keynesian principles during a recession as Democrats. The problem is that no one, except for Clinton and Gingrich et al, have been inclined to cut the deficits. Most of the politicians around today who are inclined to do so are Republicans.

If you want to argue to increase the average federal corporate rate, say 3 or 4 percentage points, maybe you could make a case for it. If you want to take it back up to 35%, you're just not making sense. It's way out of sync with other countries. You're kneecapping our businesses. How are they supposed to make things in America and export them to other countries, when their taxes are so much higher?

https://taxfoundation.org/us-effecti...te-oecd-peers/

As to higher earners, we already have the most progressive tax system in the developed world. If you want to massively increase the size of government and the welfare state, the lion's share of the money can't come from the high earners, because they don't have enough money to pay for it. See the comments here by Peter Whiteford, the economist at the OECD who did the seminal study on the progressivity of tax systems of OECD countries:

http://gregmankiw.********.com/2011/...ssive-tax.html

I'm all for lower and middle income Americans making more money and saving. Many Democrat politicians don't want to see them doing well, with good paying jobs, because it's to their benefit if people get outsized transfer payments from and are dependent on the federal government. That will keep them voting for Democrats.

And the federal government doesn't have jack to do with that, except to take taxpayer money and inefficiently redistribute part of it to states and cities. My city has a public transportation system now. And empty buses with no passengers. Because the buses didn't cost anything because they were paid for by the federal government. The power of the purse and governmental power are best exercised closest to the people, at the local and state level. My state and local governments are reasonably efficient and I have no problem paying state and local taxes. The federal government on the other hand flushes a huge amount of our money down the drain.

Baloney. Apparently you subscribe to Obama's belief that people don't build businesses, government does. You take money out of the private sector, away from the businessmen and the investors, and the economy won't grow as fast as it would otherwise. Cash flow of corporations, pass through businesses, and wealthy investors is mostly recycled back into the American economy, not spent on Italian villas. Again, look at CBO estimates for tax cuts and tax increases. You reduce taxes, you grow the economy faster. Nobody really disagrees with that.

The recovery from the 2008/2009 recession was weak by historical standards. We didn't regain 2008 employment levels until May of 2014 (see St. Louis fed employment link above.) Annual YoY GDP growth in 2009 to 2014 reanged from -2. 6% to 2. 7%. Was this Obama's fault? Hell if I know. I give Obama and the Democrats credit for not rolling off the Bush tax cuts immediately after a recession.

More "you didn't build that business" claptrap. I wish more Americans weren't spendthrifts. It would deprive the Democratic Party politicians of one of their major advantages, as long as people are highly dependent on government they're more likely to vote for Democrats.

"And the federal government doesn't have jack to do with that, except to take taxpayer money and inefficiently redistribute part of it to states and cities."

I am all for the Federal government not sending jack shit of what they collect back to the states. Since "red states" receive a disproportionate amount of those federal funds, they'll all wither and die. https://sipanews.fiu.edu/2021/03/24/...endent-states/.

[PVMonger]

Biden's plan to curtail inflation not working. Gas just went up to $6. 59 a gallon in San Diego today. Over $7 in some areas of California. Biden continues to spend tax payer dollars on giveaways and inflation rising. Idiots are still talking about Trump and past presidents while America suffers. Biden stupidly and incompetence may have USA equal the recession of the 1930's. The worst president ever and he hasn't a clue. Just like the idiots talking about the past. The past looks great with past republican or democrat presidents compared to todays leadership and the future looks even worse. Republicans are smart enough to acknowledge that Biden is a disaster. Several democrats admit USA is in trouble. The idiot socialists keep trying to talk nonsense thinking that Biden disasters will improve on their own. Stupidity at its finest.

Actually, stupidity is the fact that I spent 30-seconds reading this trash and I'll never get that time back.

[Tiny 12]

Damn it Tooms, I'm trying to cut back on posting here. But you're making it hard. Real hard.

I appreciate all the details.

They don't want you to look at the details, as long as you believe "Democrat Good, Republican Bad", they're happy.

But regardless whatever went into that hundreds of pages long TCJA, what matters is what came out of it. And what came out of it is fewer jobs were created with it than without it and the GDP growth rate did not produce a noticeable increase with it than without it.

Aaagh! The TCJA took effect on January 1, 2018. Employment grew by 2.7 million in 2018 and 2.1 million 2019. Then COVID hit. If I may be allowed to cherry pick, like you and your left of center media sources do, the average growth per year in employment during Obama's administration was 1. 4 million.

https://www.bls.gov/opub/mlr/2019/ar...es-in-2018.htm
https://www.bls.gov/opub/mlr/2020/ar...industries.htm
https://fred.stlouisfed.org/series/PAYEMS

And in 2018 and 2019, as described in post #10452, we were inching closer and closer to full employment. That made it harder to add jobs. Finally as described in post 10377 and the link in #10381, the demographic wind was at our back in the final years of Obama's administration. The working aged population, 18 to 64, increased by 2.3 million from 2013 to 2016, the last 3 years of Obama's administration, versus 270,000 from 2017 to 2020.

Finally, the labor force participation rate fell like a rock for the first 6 years of the Obama administration, prior to flattening in 2015. After the TCJA took effect, it kicked up, from 62.7% in January, 2017 to 63.4% in January, 2020, before COVID hit.

https://fred.stlouisfed.org/series/CIVPART

We've already discussed GDP growth rate, and I've listed some of the factors like globalization, changes in technology, the business cycle, a pandemic, what's going on in China and the rest of the world, Congress, that often are as important or more important than who's president. And provided links that show the increase in growth in real median wages and real median household income was off the charts, compared to past years, in 2019.

At a cost of Trillions.

You're just rehashing what we've already discussed. You have to assume all provisions of the TCJA will be extended to get to "trillions of dollars. " Estimates were that the TCJA would reduce government revenues by $1.5 million. So far the amount has likely been under $1 trillion, maybe half of what the Democrats' American Rescue Plan cost in 2021 alone. The Democrats control the presidency, the Senate and the House, and they haven't repealed the TCJA. I believe Democrats should receive at least part of the credit and praise for any revenue losses after January 21,2021 from the corporate tax cuts. Although recent data shows corporate tax revenues were actually about as high in 2021 as what the CBO was predicting they would have been without the TCJA. Biden BTW only wanted to increase the corporate rate back to 28%.

https://taxfoundation.org/corporate-tax-revenue-federal-tax-collections/

Once the unemployment rate hits the "Full Employment" level, which it did in this era sometime about 2 years before Trump took office, a 1-2% uptick or dip here and there is really meaningless. Extreme weather events, baby-boom retirements, whatever. Not all that much to do with some economic legislation.

PLEASE!! The closer you get to full employment, the harder it is to reduce the unemployment rate.

Almost all economic legislation is like the TCJA. Pages and pages of details, something given to someone here, something taken from someone there. And whatever is given in that bill sf often taken away in another bill and vice versa. That's why I try only to focus on the end results from administration terms, their budget proposals, what got passed and all that, not digging into the weeds so much since everyone digging is bound to miss some detail elsewhere that changed everything.

I'm all for tax cuts, if the politicians will also reduce the spending, which they didn't during Trumps' term. However, I don't have an argument with what you're saying. The TCJA didn't reduce the complexity of the tax code. The one part of the TCJA I heartily approve of are changes in the corporate tax. They hurt me (and helped you), but still, they were so clearly needed I don't feel compelled to argue against them. You do because of your Stockholm Syndrome. As to the QBI deduction for pass throughs and cuts in individual rates, there are valid arguments for and against them.

However, I do think it is valid to factor in the repeated and obvious stated goals and intentions of each party involved in crafting legislation. Because it is their overall philosophy that guides every detail they put into legislation. You will see the sum of all the details in all the related legislation in the results. That's where Dems' Demand-Side economic philosophy vs Repubs' Supply-Side economic philosophy comes into play.

It's not 1932 any more. Republicans are just as inclined to use Keynesian principles during a recession as Democrats. The problem is that no one, except for Clinton and Gingrich et al, have been inclined to cut the deficits. Most of the politicians around today who are inclined to do so, and they're a minority in both parties, are Republicans.

There is a very good reason Dems' Demand-Side philosophy (putting more money in the pockets of the lower and middle income earners) always significantly outperforms Repubs' Supply-Side philosophy (putting more money in the pockets of corporations and the top income earners) on jobs creation, expanding the economy, paying down the debt and deficits, etc. And, sorry, it is also blissfully "simple".
Lower and middle income earners tend to spend all the money in their pockets very quickly, often right up to their next paycheck. For obvious reasons. All too often, they need to. Put more money in the pockets of lower and middle income earners and they will be hitting restaurants and malls to spend it today. The economy will grow. Businesses will get more customers and will need to expand just to keep up. Businesses will need to hire more workers. Grudgingly, as usual. But they will need to hire or miss out. Tax revenue from businesses and workers grows.

If you want to argue to increase the average federal corporate rate, say 3 or 4 percentage points, maybe you could make a case for it. If you want to take it back up to 35%, you're just not making sense. It's way out of sync with other countries. You're kneecapping our businesses. How are they supposed to make things in America and export them to other countries, when their taxes are so much higher?

https://taxfoundation.org/us-effecti...te-oecd-peers/

As to higher earners, we already have the most progressive tax system in the developed world. If you want to significantly increase the size of government and the welfare state, the lion's share of the money can't come from the high earners, because they don't have enough money to pay for it. See the comments here by Peter Whiteford, the economist at the OECD who did the seminal study on the progressivity of tax systems of OECD countries:

http://gregmankiw.********.com/2011/...ssive-tax.html

I'm all for lower and middle income Americans making more money and saving. Some Democrat politicians don't want to see them doing well, with good paying jobs, because it's to their benefit if people get outsized transfer payments from and are dependent on the federal government. That will keep them voting for Democrats.

Roads, bridges, schools, etc get repaired. More jobs are created from that. Police forces get funded. It goes on.

And the federal government doesn't have jack to do with that, except to take taxpayer money and inefficiently redistribute part of it to states and cities. My city has a public transportation system now. And empty buses with no passengers. Because the buses didn't cost anything because they were paid for by the federal government. The power of the purse and governmental power are best exercised closest to the people, at the local and state level. My state and local governments are reasonably efficient and I have no problem paying state and local taxes. The federal government on the other hand flushes a huge amount of our money down the drain.

Corporations and top income earners tend not to spend extra money in their pockets very quickly, if at all. Again, for obvious reasons. They don't need to. There are only so many hamburgers a wealthy person or corporate CEO can eat in a week, only so many cars they can drive, boats they can sail, etc. They can bank it and forget about it. They can speculate on stocks with it. In fact, they can easily create a stock market bubble with fun discretionary money and laugh when the bubble bursts. They can buy another villa in Italy with it. And I assure you the last thing they want to do with extra money in their pocket is expand their business requiring them to hire more pain-in-the-ass employees if it is not clear their doing so would increase their pleasure in life rather than reduce it and add more complications and hassle to their lives.
On top of which, there are too few of those top marginal income earners compared to the huge percentage of lower and middle income earners for any big deal tax cut for them to matter. It cannot possibly do much for the economy and, guess what, it never does. Well, it does add to the deficit in a big way and diverts tax revenue money that sure could come in handy when the inevitable Great Repub Recession comes around.

Baloney. Apparently you subscribe to Obama's belief that people don't build businesses, government does. You take money out of the private sector, away from the businessmen and the investors, and the economy won't grow as fast as it would otherwise. Cash flow of corporations, pass through businesses, and wealthy investors is mostly recycled back into the American economy, not spent on Italian villas. Again, look at CBO estimates for tax cuts and tax increases. You reduce taxes, you grow the economy faster. Nobody really disagrees with that.

It used to crack me up when weepy Repub John Boehner would take the floor of Congress and demand an answer from Obama, "Where are the jobs"? And then he would extoll the virtues of what he termed "Job creators", by which he meant the beneficiaries of his Party's typical Supply-Side / Trickle-Down economic failures. He was just slamming a Dem and flattering the ego of his favorite political donor class by telling them they and not the unwashed rabble were the "job creators. ".

First of all, Obama's economy recovered and created more jobs than any Repub ever could have created had a Repub ever taken over from a Dem with economic conditions as disastrous as it was when Obama took over from GWB. But, of course, they never have done that in at least 100 years.

Second, one reason Obama's recovery was slower than it easily could have been was because Moscow Mitch had that meeting on Obama's inauguration night and set the orders for everyone in his caucus and it was so in the House as well not to do anything to help Obama pull us out of that Great Repub Crash and Recession. Which in one case meant they would stubbornly obstruct Obama's efforts to go back to the Clinton / Dem top marginal tax rates. And that kept the recovery from really taking off. LOL. Let's just say there was no Repub counterpart to Tip O'Neill working with Obama.

The recovery from the 2008/2009 recession was weak by historical standards. We didn't regain 2008 employment levels until May of 2014 (see St. Louis fed employment link above.) Annual YoY GDP growth in 2009 to 2014 ranged from -2. 6% to 2. 7%. Was this Obama's fault? Hell if I know. I give Obama and the Democrats credit for not rolling off the Bush tax cuts immediately after a recession.

Third, the relatively few typical beneficiaries of Repubs' consistently failed Supply-Side / Trickle-Down philosophy are not the true "job creators" in a national economy. The true "job creators" are the many, many more lower and middle income earners who go into the marketplace and spend all the money in their pockets as quickly as possible, essentially forcing businesses to do something they for the most part hate to do; hire more employees to keep up with the customer traffic.

More "you didn't build that business" claptrap. I wish more Americans weren't spendthrifts. It would deprive the Democratic Party politicians of one of their major advantages -- as long as people are highly dependent on government they're more likely to vote for Democrats.

[EihTooms]

Interesting post, thanks. Bloomberg and Brookings are both basing their stories on the Tax Policy Center. The Tax Policy Center was set up by the Urban Institute and Brookings Institute. It's not merely left of center, it's left wing, and staffed by Progressive economists. The change in after tax income is explained by our sharply progressive tax system. Overall, we have the most progressive tax system in the OECD, and the federal income tax is more progressive than sales taxes and property taxes. Anyway, if a low income earner is paying at an average 10% tax rate, and you cut his taxes by 10%, the increase in his after tax income is 1%. If an upper income earner is paying at 40%, and you cut his taxes by 5%, his after tax income increases by 2%. So yes, the upper income earner shows a larger increase in after tax income.

You have a point when you say that all I looked at were the tax tables. I don't know everything that went into the TCJA. I make more than the average American, and my taxes went up. I have a real estate property in a foreign country that I hold through a foreign company. I have to pay at an 80%+ tax rate on income from the foreign property, because of the GILTI tax in TCJA! And I can't take full advantage of the state income tax deduction any longer. But certainly the TCJA helped Donald Trump, for example, a lot. The Trump Organization undoubtedly benefits greatly from the QBI deduction for pass through entities from income associated with high levels of depreciation.

Your sources are old and, being based on TPC analysis, biased. It would be better to look at actual, recent data. I pulled IRS tax statistics for 2017,2018 and 2019 (last year available), and compared tax rates for those years by income level. You can do this if you wish here.

https://www.irs.gov/statistics/soi-t...d-gross-income

The tax cuts took effect on January 1, 2018. It didn't really make a difference whether I looked at 2017 vs. 2018 or 2017 vs. 2019, overall the numbers looked similar. For 2017 vs. 2019, people earning $10,000 or less saw their taxes cut by 27% to 40%. That's not a big deal though, because they were paying little taxes to begin with. The big winners were people making $40,000 to $500,000. Their taxes went down from 16% to 18%. People making $20,00 to $40,000 and $500,000 to $1,000,000 saw cuts of 10% to 12%. Those who benefitted the least made in the range of $10,000 to $20,000 and $1 million+.

So this basically looked like another sop to the middle class, who account for the majority of voters. Which perhaps was the intention all along. One caveat, I'm not sure that the TCJA was entirely responsible for the changes in average tax rates, there may have been other factors at play.

Americans for Tax Reform, which like the Brookings Institute is biased, published this piece on how the tax system became more progressive after the TCJA. They don't really show cause and effect though. Anyway, their numbers are almost certainly correct:

https://www.atr.org/new-cbo-report-f...s-progressive/

Editorial Comment: One thing that amazes me, from the piece, is that the top 1% pays 41.7% of the income tax. And Democrats still say the wealthy don't pay their fair share. Democrats need to focus their efforts on helping those who aren't doing as well as the rest of us, instead of tearing down the people at the top. To their credit, Kyrsten Sinema and a few others do exactly that, despite the pressure from the progressives to concentrate on class warfare.

As to the corporate tax cuts, you really need to get over your Stockholm Syndrome and appreciate what's best for your stock portfolio and America. The effects of the tax cuts were reflected more in wages than in a reduced unemployment rate. We got to 3. 5% unemployment before COVID hit, the lowest since 1969. How much lower can you go? Real wages and household income took a huge jump upwards in 2019. As to capital spending, regardless of what the survey says, it jumped up after the TCJA. The "capital expenditures" component of stocks in the S&P 500 index was in the range of 71 to 76 in 2012 to 2017. It was 71.43 in 2017. It jumped up to 83.46 in 2019 and 90.90 in 2019.

A lot of money came back to the USA as a result of the TCJA. Companies were keeping it overseas because they'd have to pay up to 35% tax on it if they brought it back. Wharton said as much as $2. 8 trillion were parked overseas. I'm not sure how much of that came back, but through expansions, capital spending, dividends, share buybacks, and parking the money at USA Banks where it can be leant out, what money that did come back is now circulating in our economy.

I can't understand why anyone would take the position that the corporate tax rate didn't need to come down. Including state income taxes, our average rate was around 40%. The next highest in the developed world was Australia, at 30%. And Australia, unlike the USA, doesnt tax dividends. Yeah, some companies with loopholes and who had subsidiaries in tax haven countries, were getting by just fine. (Aside: The TCJA helped in this regard with the GILTI tax that I was b*tching about above. Now companies can't park money overseas and avoid taxes from their foreign operations, because of TCJA.) But many of our companies just weren't competitive. Even Obama and Biden wanted to bring the rate down to 28%.

This will be my last post for a while. I've gotten addicted to replying to your posts and it's eating up way too much time. You're a worthy competitor on the battlefield of ideas, especially considering you're fighting from a much weaker position, having to defend the economic policies of a Democratic Party that's increasingly dominated by progressives.

P.S. If you want my Excel table or the capex data for the S & P 500 send me a PM with an email address. I cant link to them.

I appreciate all the details. But regardless whatever went into that hundreds of pages long TCJA, what matters is what came out of it. And what came out of it is fewer jobs were created with it than without it and the GDP growth rate did not produce a noticeable increase with it than without it. At a cost of Trillions. The unemployment rate was declining in a straight line from the year Obama and the Dems passed the American Recovery and Reinvestment Act at the end of February 2009 with no Repub votes. The fact that it continued on that trajectory until it declined to 3. 5% under Trump after it was already down to 4. 7% when he took over is nice, but meaningless in terms of the TCJA. Once the unemployment rate hits the "Full Employment" level, which it did in this era sometime about 2 years before Trump took office, a 1-2% uptick or dip here and there is really meaningless. Extreme weather events, baby-boom retirements, whatever. Not all that much to do with some economic legislation.

Almost all economic legislation is like the TCJA. Pages and pages of details, something given to someone here, something taken from someone there. And whatever is given in that bill sf often taken away in another bill and vice versa. That's why I try only to focus on the end results from administration terms, their budget proposals, what got passed and all that, not digging into the weeds so much since everyone digging is bound to miss some detail elsewhere that changed everything.

However, I do think it is valid to factor in the repeated and obvious stated goals and intentions of each party involved in crafting legislation. Because it is their overall philosophy that guides every detail they put into legislation. You will see the sum of all the details in all the related legislation in the results. That's where Dems' Demand-Side economic philosophy vs Repubs' Supply-Side economic philosophy comes into play.

There is a very good reason Dems' Demand-Side philosophy (putting more money in the pockets of the lower and middle income earners) always significantly outperforms Repubs' Supply-Side philosophy (putting more money in the pockets of corporations and the top income earners) on jobs creation, expanding the economy, paying down the debt and deficits, etc. And, sorry, it is also blissfully "simple".

Lower and middle income earners tend to spend all the money in their pockets very quickly, often right up to their next paycheck. For obvious reasons. All too often, they need to. Put more money in the pockets of lower and middle income earners and they will be hitting restaurants and malls to spend it today. The economy will grow. Businesses will get more customers and will need to expand just to keep up. Businesses will need to hire more workers. Grudgingly, as usual. But they will need to hire or miss out. Tax revenue from businesses and workers grows. Roads, bridges, schools, etc get repaired. More jobs are created from that. Police forces get funded. It goes on.

Corporations and top income earners tend not to spend extra money in their pockets very quickly, if at all. Again, for obvious reasons. They don't need to. There are only so many hamburgers a wealthy person or corporate CEO can eat in a week, only so many cars they can drive, boats they can sail, etc. They can bank it and forget about it. They can speculate on stocks with it. In fact, they can easily create a stock market bubble with fun discretionary money and laugh when the bubble bursts. They can buy another villa in Italy with it. And I assure you the last thing they want to do with extra money in their pocket is expand their business requiring them to hire more pain-in-the-ass employees if it is not clear their doing so would increase their pleasure in life rather than reduce it and add more complications and hassle to their lives.

On top of which, there are too few of those top marginal income earners compared to the huge percentage of lower and middle income earners for any big deal tax cut for them to matter. It cannot possibly do much for the economy and, guess what, it never does. Well, it does add to the deficit in a big way and diverts tax revenue money that sure could come in handy when the inevitable Great Repub Recession comes around.

It used to crack me up when weepy Repub John Boehner would take the floor of Congress and demand an answer from Obama, "Where are the jobs"? And then he would extoll the virtues of what he termed "Job creators", by which he meant the beneficiaries of his Party's typical Supply-Side / Trickle-Down economic failures. He was just slamming a Dem and flattering the ego of his favorite political donor class by telling them they and not the unwashed rabble were the "job creators. ".

First of all, Obama's economy recovered and created more jobs than any Repub ever could have created had a Repub ever taken over from a Dem with economic conditions as disastrous as it was when Obama took over from GWB. But, of course, they never have done that in at least 100 years.

Second, one reason Obama's recovery was slower than it easily could have been was because Moscow Mitch had that meeting on Obama's inauguration night and set the orders for everyone in his caucus and it was so in the House as well not to do anything to help Obama pull us out of that Great Repub Crash and Recession. Which in one case meant they would stubbornly obstruct Obama's efforts to go back to the Clinton / Dem top marginal tax rates. And that kept the recovery from really taking off. LOL. Let's just say there was no Repub counterpart to Tip O'Neill working with Obama.

Third, the relatively few typical beneficiaries of Repubs' consistently failed Supply-Side / Trickle-Down philosophy are not the true "job creators" in a national economy. The true "job creators" are the many, many more lower and middle income earners who go into the marketplace and spend all the money in their pockets as quickly as possible, essentially forcing businesses to do something they for the most part hate to do; hire more employees to keep up with the customer traffic.

[Cali Guy]

Biden's plan to curtail inflation not working. Gas just went up to $6. 59 a gallon in San Diego today. Over $7 in some areas of California. Biden continues to spend tax payer dollars on giveaways and inflation rising. Idiots are still talking about Trump and past presidents while America suffers. Biden stupidly and incompetence may have USA equal the recession of the 1930's. The worst president ever and he hasn't a clue. Just like the idiots talking about the past. The past looks great with past republican or democrat presidents compared to todays leadership and the future looks even worse. Republicans are smart enough to acknowledge that Biden is a disaster. Several democrats admit USA is in trouble. The idiot socialists keep trying to talk nonsense thinking that Biden disasters will improve on their own. Stupidity at its finest.

[Spidy]

Thats exactly what it is. And usually from the people that CANNOT think for themselves. How ironic. Yes, its how it works. Our way, or the highway. Thats the US system. Been that way for a few decades, I call it binary thinking, and yes it does spell trouble.

Don't worry, the protagonist has joined my shortlist of ignored folk. No doubt he will respond here with more drivel.

Why wouldn't I respond here, it is a discussion/opinion forum after all. As you've reminded us on many occasions. But you seem to use this thread as a means to simply bash BMs and America.

...He is like a dog w a bone. Hehe.

Better a dog with a bone, than a spewing "dog-ma" without one. Or a dog that stands for nothing and falls for everything, chasing its tail, like a half-crazed mutt.

Once again, your QAnon/Repub/Bothsidesism "dog-ma" is all bark and no bite.

[Tiny 12]

I'm sure you just forgot about the phase outs, catch up increased taxes and cleverly concealed and delayed costs to the lower and middle income earners in order to "pay for" those disproportionately high tax cuts for corporations and top margins, the ones that wouldn't phase out, diabolically timed to kick in after certain subsequent midterm and general elections as I recall. Even Hitler wouldn't have done that. But it was in all the news at the time. That was one of the reasons "retiring" Senator John McCain slammed it. However, being a Repub he signed it anyway.

Nice try though.

A Year After the Middle Class Tax Cut, the Rich Are Winning.
December 18, 2018

https://www.bloomberg.com/graphics/2...-consequences/

Once the tax bill is paid for, low- and middle-income households will be worse off.
January 2, 2018

https://www.brookings.edu/blog/up-fr...-be-worse-off/

Remember when Trump proclaimed he was going to be the "most job-creating president in the history of the universe" or some such nonsense? He sold that god-awful waste of $2. 5+ Trillion in taxpayers' money on that premise and on his prediction that it would drive Real Annual GDP growth up to "3%, 4%, 5%, some people say 6% LOL. It never hit 3%.

Did Trumps tax cuts boost hiring? Most companies say no.
January 28, 2019

https://www.pbs.org/newshour/economy...mpanies-say-no

Yeah, I'm pretty sure if those tax cuts had benefitted the lower and middle income earners as much or more than they did corporations and the top margins and not made those lower and middle income earners "pay for" Trump's Classic Repub tax cuts for the rich, the Trump economy would not have produced 1. 5 Million fewer jobs with those $2. 5 Trillion cuts than without the cuts.

But they didn't.

Actually, Biden and the Dems "extending" them as they were originally set DID cut taxes for lower and middle income earners since allowing them to do what they were destined to do re increasing costs for those marginal earners instead of cutting costs for them.

Dems, the Party of Meaningful Tax Cuts, Strike Again!

Interesting post, thanks. Bloomberg and Brookings are both basing their stories on the Tax Policy Center. The Tax Policy Center was set up by the Urban Institute and Brookings Institute. It's not merely left of center, it's left wing, and staffed by Progressive economists. The change in after tax income is explained by our sharply progressive tax system. Overall, we have the most progressive tax system in the OECD, and the federal income tax is more progressive than sales taxes and property taxes. Anyway, if a low income earner is paying at an average 10% tax rate, and you cut his taxes by 10%, the increase in his after tax income is 1%. If an upper income earner is paying at 40%, and you cut his taxes by 5%, his after tax income increases by 2%. So yes, the upper income earner shows a larger increase in after tax income.

You have a point when you say that all I looked at were the tax tables. I don't know everything that went into the TCJA. I make more than the average American, and my taxes went up. I have a real estate property in a foreign country that I hold through a foreign company. I have to pay at an 80%+ tax rate on income from the foreign property, because of the GILTI tax in TCJA! And I can't take full advantage of the state income tax deduction any longer. But certainly the TCJA helped Donald Trump, for example, a lot. The Trump Organization undoubtedly benefits greatly from the QBI deduction for pass through entities from income associated with high levels of depreciation.

Your sources are old and, being based on TPC analysis, biased. It would be better to look at actual, recent data. I pulled IRS tax statistics for 2017,2018 and 2019 (last year available), and compared tax rates for those years by income level. You can do this if you wish here.

https://www.irs.gov/statistics/soi-t...d-gross-income

The tax cuts took effect on January 1, 2018. It didn't really make a difference whether I looked at 2017 vs. 2018 or 2017 vs. 2019, overall the numbers looked similar. For 2017 vs. 2019, people earning $10,000 or less saw their taxes cut by 27% to 40%. That's not a big deal though, because they were paying little taxes to begin with. The big winners were people making $40,000 to $500,000. Their taxes went down from 16% to 18%. People making $20,00 to $40,000 and $500,000 to $1,000,000 saw cuts of 10% to 12%. Those who benefitted the least made in the range of $10,000 to $20,000 and $1 million+.

So this basically looked like another sop to the middle class, who account for the majority of voters. Which perhaps was the intention all along. One caveat, I'm not sure that the TCJA was entirely responsible for the changes in average tax rates, there may have been other factors at play.

Americans for Tax Reform, which like the Brookings Institute is biased, published this piece on how the tax system became more progressive after the TCJA. They don't really show cause and effect though. Anyway, their numbers are almost certainly correct:

https://www.atr.org/new-cbo-report-f...s-progressive/

Editorial Comment: One thing that amazes me, from the piece, is that the top 1% pays 41.7% of the income tax. And Democrats still say the wealthy don't pay their fair share. Democrats need to focus their efforts on helping those who aren't doing as well as the rest of us, instead of tearing down the people at the top. To their credit, Kyrsten Sinema and a few others do exactly that, despite the pressure from the progressives to concentrate on class warfare.

As to the corporate tax cuts, you really need to get over your Stockholm Syndrome and appreciate what's best for your stock portfolio and America. The effects of the tax cuts were reflected more in wages than in a reduced unemployment rate. We got to 3. 5% unemployment before COVID hit, the lowest since 1969. How much lower can you go? Real wages and household income took a huge jump upwards in 2019. As to capital spending, regardless of what the survey says, it jumped up after the TCJA. The "capital expenditures" component of stocks in the S&P 500 index was in the range of 71 to 76 in 2012 to 2017. It was 71.43 in 2017. It jumped up to 83.46 in 2019 and 90.90 in 2019.

A lot of money came back to the USA as a result of the TCJA. Companies were keeping it overseas because they'd have to pay up to 35% tax on it if they brought it back. Wharton said as much as $2. 8 trillion were parked overseas. I'm not sure how much of that came back, but through expansions, capital spending, dividends, share buybacks, and parking the money at USA Banks where it can be leant out, what money that did come back is now circulating in our economy.

I can't understand why anyone would take the position that the corporate tax rate didn't need to come down. Including state income taxes, our average rate was around 40%. The next highest in the developed world was Australia, at 30%. And Australia, unlike the USA, doesn’t tax dividends. Yeah, some companies with loopholes and who had subsidiaries in tax haven countries, were getting by just fine. (Aside: The TCJA helped in this regard with the GILTI tax that I was b*tching about above. Now companies can't park money overseas and avoid taxes from their foreign operations, because of TCJA.) But many of our companies just weren't competitive. Even Obama and Biden wanted to bring the rate down to 28%.

This will be my last post for a while. I've gotten addicted to replying to your posts and it's eating up way too much time. You're a worthy competitor on the battlefield of ideas, especially considering you're fighting from a much weaker position, having to defend the economic policies of a Democratic Party that's increasingly dominated by progressives.

P.S. If you want my Excel table or the capex data for the S & P 500 send me a PM with an email address. I cant link to them.

[PedroMorales]

Here is a thought: all Americans are war mongering sociopaths. Every last one of them. Nice numerical cut off points but little good to all the others murdered by Americans and their proxies. Despite the considerable competition, Americans are far and away the scummiest war mongers the world has ever seen.

[Tiny 12]

Japan attacked our military base at Pearl Harbor and then Germany declared war on America in WWII. Do you really think that meant America "chose" to go to war with them?

Eisenhower committed America to the Vietnam War by word, deed and treaty:

Southeast Asia and the Vietnam War

https://media.defense.gov/2019/Feb/2...ology%20v1.pdf

USA military body bags were being returned from Vietnam long before Kennedy was elected. The change Kennedy made was in allowing our troops to shoot back.

Please note my disclaimer: While my numbers are correct, I don't believe this. Democrats aren't any bigger war mongers than Republicans. This is part of an intervention, to try to help Tooms recognize spurious correlations and Double Think, and to cure his Stockholm Syndrome.

This is an attempt to try to get you to understand, for example, GDP growth is lower when a once-in-a-hundred-year pandemic strikes. And higher after we're rebounding from the worst depression in USA History. And neither has anything to do with whether a Republican or Democrat is president.

[EihTooms]

The term is clearly used by individuals like Tooms as an ad hominem against those who aren't on board with his cherry picking and Dems are light / Repubs are darkness interpretive framework. Online definitions of the term involve the accusation that one is unjustifiably giving equal validity to two sides of an argument, but such an error hardly of necessity follows from questioning some of Toom's simplistic, dubious and blustery claims or his far left sources. Tiny is correct, responsible economic and historical analysis is more complicated than "Democrat good, Republican bad. " End of story.

Forgive the "simplistic" approach, Paulie. But it has been several days since I offered this exceedingly simple challenge and so far not one person has come up with a single item. Including you. Maybe you didn't see it so I will repost it here and now for you.

Yes, I was trying to make it as simple and easy as possible for any pro-Repub Bothsider or outright Repub supporter to jump in, meet or beat this simple challenge and show me the way.

However, unless someone wants to highlight and praise the 2-3 worst Great Repub Depressions / Great Repub Recessions and Massive Jobs Destruction in history as fine examples of what Repubs can "accomplish" with legislation they pass while occupying the White House and controlling both houses of Congress, I'm afraid we're not going to see much of a list here:

Shall we dance through a short list of legislation passed when a Dem was in the White House and Dems controlled both Houses of Congress?

Social Security. A favorite of yours I believe.

Medicare. Ditto above.

Medicaid.

Unemployment Insurance.

The Civil Rights Act.

401 ks For Rank and File Employees.

The 1993 Omnibus Budget Reconciliation Act.

The American Recovery and Reinvestment Act.

The Affordable Care Act.

The American Rescue Plan.

The Infrastructure Investment and Jobs Act.

The CHIPS and Science Act of 2022.

The Inflation Reduction Act.

To name just a few.

Ok, now it's your turn or anyone else's turn. Please list a few legislation highlights from when a Repub was in the White House and Repubs controlled both Houses of Congress.

[EihTooms]

...
When Leonhardt writes off Congressional control as a factor he loses credibility in my eyes.
...
At the risk of sounding immodest, my post #10362 in this thread makes more sense and is less biased than Leonhardt's article.

Ok, let's go with your idea.

With the constant and most common denominator for crap economic results being a Repub in the White House, accompanying oil shocks and all ("August 2001 PDB? What August 2001 PDB"? GW Bush might well have asked in September of that year), I guess the only conclusion is when Dems control Congress during those times the Repub POTUS is just plain ineffectual and unable to prevent those dastardly Dems from fucking up his economy. By contrast, Dems in the White House can somehow manage to get some positive things done anyway with Repubs controlling Congress.

So how does that support your contention again?

My contention still is that any legislation proposed, fought for and passed by Dem Presidents and Dems in Congress is diminished in its effectiveness and positive results with every Repub vote it receives. Why wouldn't that be so if those are votes are coming from people who think this government of, by and for We, The People and nobody else "is the problem" and have gleefully gone to war against it?

Oh, and on that last point, if Repubs are so effective and positive either when they are in the White House or when they control Congress, why have they never proposed and passed a single piece of meaningful legislation or anything whatsoever worthy of being revered and cited as something that Makes America Great when they controlled BOTH the White House and Congress over the past century?

I challenged you and anyone else here to rack their brains, rip through Google Search and come up with the list of legislation even remotely rivalling that of Dems when they were in the White House and controlled both houses of Congress. That was several days ago. So far not one person has been able to come up with anything.

I mean, we know they produced 2-3 of worst Great Repub Recessions and Crashes in history thanks to the legislation they came up with under those circumstances. But I was hoping to be surprised by something, you know, a bit more positive than those Repub "accomplishments. ".

[EihTooms]

Here are the total number of USA Casualties in the 20th and 21st centuries, in major wars that Democratic Presidents chose to enter. I'm defining "major" as any war that resulted in more than 50,000 USA Casualties:

World War I: 320,518.

World War II: 1,076,245.

Korean War: 128,650.

Vietnam War: 211,454.

Total: 1,736,867 casualties.

Here's the total number of casualties in "major" wars started by Republicans, in the 20th and 21st centuries:

0.

This shows that Democratic Presidents have a very callous attitude about the lives and well being of our servicemen.

Now I know what Tooms response will be. "So what, Trump killed a lot of people with COVID." Well, yes, he killed about 370,000 people with COVID, until he left office. But Biden killed more, 700,000 so far! and he's still killing 500 a day! There's no telling how many people Biden's going to end up killing with COVID.

Disclaimer: While my numbers are correct, I don't believe this. Democrats aren't any bigger war mongers than Republicans. This is part of an intervention, to try to help Tooms recognize spurious correlations and Double Think, and to cure his Stockholm Syndrome.

Japan attacked our military base at Pearl Harbor and then Germany declared war on America in WWII. Do you really think that meant America "chose" to go to war with them?

Eisenhower committed America to the Vietnam War by word, deed and treaty:

Southeast Asia and the Vietnam War

https://media.defense.gov/2019/Feb/2...ology%20v1.pdf

1959
May 25: With authorization from the White House, Adm. Harry Felt, the
CINCPAC, told General Williams that U.S. advisors with the ARVN could
accompany Vietnamese troops on operations, provided they do not become
involved in actual combat. Historian Fredrik Logevall called this new order
highly significant. To this point, U.S. troops had been confined to corps
and division headquarters, training commands, and logistic agencies and
had been obligated to remain behind whenever their units were on patrol.
Now they would be in the field, in harms way, their advising duties greatly
expanded. U.S. personnel had been participating in patrols before this time,
unofficially, including Williams himself on occasion.59

July 8: Six Vietnamese communist guerrillas attacked the quarters of the
thirteen-man U.S. advisory detachment at Bien Hoa. Two U.S. soldiers,
Maj. Dale R. Buis and MSgt. Chester M. Ovnand, died in the assault,
the first U.S. servicemen killed in action in Vietnam since Lt. Col. Peter
Dewey in 1945 (see Sept. 26, 1945). Buis and Ovnard are the first two
names that appear on the Vietnam Veterans Memorial in Washington.63

USA military body bags were being returned from Vietnam long before Kennedy was elected. The change Kennedy made was in allowing our troops to shoot back.

[EihTooms]

Here are tax cuts from the Republican's 2017 TCJA, calculated as (1- (marginal rate after tax cut)/(marginal tax rate before tax cut)), for single filers at particular levels of income:

$30,000 - 20% tax cut.

$50,000 - 12% tax cut.

$100,000 - 14% tax cut.

$250,000 - 6% tax increase.

$400,000 - 6% tax increase.

$1,000,000 - 6. 5% tax cut.

https://taxfoundation.org/historical...ates-brackets/

The tax cut was not disproportionately directed to higher income earners. In fact, it made the tax system more progressive.

I take issue with your statement: "Then the beauty of Dem leadership is you get the superior economic results without invading Poland and creating the Holocaust. " Strictly speaking this is true, as no Democratic President has invaded Poland. Yet. However, please see my post below about the correlation between Democratic Presidents and major wars. The Democrats are a bloodthirsty lot, disposed to sacrifice many lives so they can juice the economy and get more votes come election time.

Disclaimer: I actually don't believe this, the part about bloodthirsty Democrats. This is part of an intervention, to try to help Tooms recognize spurious relationships and Double Think, and to cure his Stockholm Syndrome.

HOWEVER, In general, GDP growth during wars and their aftermath when Democrats were president was very good -- there were a few years with 18%+ GDP growth. Does this deserve consideration if you're trying to show that Republicans are worse than Hitler at managing the economy? Why of course not.

I'm sure you just forgot about the phase outs, catch up increased taxes and cleverly concealed and delayed costs to the lower and middle income earners in order to "pay for" those disproportionately high tax cuts for corporations and top margins, the ones that wouldn't phase out, diabolically timed to kick in after certain subsequent midterm and general elections as I recall. Even Hitler wouldn't have done that. But it was in all the news at the time. That was one of the reasons "retiring" Senator John McCain slammed it. However, being a Repub he signed it anyway.

Nice try though.

A Year After the Middle Class Tax Cut, the Rich Are Winning.
December 18, 2018

https://www.bloomberg.com/graphics/2...-consequences/

Distribution of Trump Tax Cuts Favors Wealthiest
On average, in 2018, taxes declined for everyone, but top groups got the biggest benefit
Income group (Average income)

Percent change in after-tax income

Lowest quintile ($14,170) - 0.4%

Second quintile ($36,450) - 1.2%

Middle quintile ($65,640) - 1.6%

Fourth quintile ($114,370) - 1.9%

Top quintile ($347,940) - 2.9%

Source: Tax Policy Center estimates
Note: Average federal tax (includes individual and corporate income tax, payroll taxes for Social Security and Medicare, the estate tax, and excise taxes) as a percentage of average expanded cash income.

Once the tax bill is paid for, low- and middle-income households will be worse off.
January 2, 2018

https://www.brookings.edu/blog/up-fr...-be-worse-off/

The Tax Cuts and Jobs Act (TCJA) will cut taxes by almost $1.5 trillion over the next decade, largely benefiting corporations, pass-through businesses such as partnerships, and people who inherit large estates. The bill will also provide modest tax reductions for most wage and salary earners.

Though some households will do better than others, it sounds like almost everyone is a winner at first glance. But tax cuts are not free; they eventually have to be financed with higher taxes or lower spending. And once those financing requirements are taken into account, most low- and middle-income households are likely to be worse off than they would have been without the tax cut in the first place.

Previous TPC analysis shows that households in every income group will be better off on average due to the direct provisions of the tax cut. However, after accounting for a plausible financing mechanismin which the tax cuts would be paid for with equal-per-household increases in taxes or reductions in benefitsmany low- and middle-income households will lose more than what they gain from the tax cuts themselves.

(and more)

Remember when Trump proclaimed he was going to be the "most job-creating president in the history of the universe" or some such nonsense? He sold that god-awful waste of $2. 5+ Trillion in taxpayers' money on that premise and on his prediction that it would drive Real Annual GDP growth up to "3%, 4%, 5%, some people say 6% LOL. It never hit 3%.

Did Trumps tax cuts boost hiring? Most companies say no.
January 28, 2019

https://www.pbs.org/newshour/economy...mpanies-say-no

The vast majority of American businesses havent boosted hiring or investment as a result of the Republican tax law, according to a survey by the National Association for Business Economics.

Eighty-four percent of businesses said they didnt accelerate hiring because of the 2017 Tax Cuts and Jobs Act, which President Donald Trump hailed as a bill for the middle class and a bill for jobs. Only 6 percent said they had more hires because of the law and 10 percent said they accelerated investments, according to the survey.

Yeah, I'm pretty sure if those tax cuts had benefitted the lower and middle income earners as much or more than they did corporations and the top margins and not made those lower and middle income earners "pay for" Trump's Classic Repub tax cuts for the rich, the Trump economy would not have produced 1. 5 Million fewer jobs with those $2. 5 Trillion cuts than without the cuts.

But they didn't.

Actually, Biden and the Dems "extending" them as they were originally set DID cut taxes for lower and middle income earners since allowing them to do what they were destined to do re increasing costs for those marginal earners instead of cutting costs for them.

Dems, the Party of Meaningful Tax Cuts, Strike Again!

[Spidy]

...And your insistence that the Dems have done a better job than the Reps is very poor rationale...

It isn't my "insistance" that gives Dems the notable edge in producing better economic results than Repubs. It's the data.

You have any quotes or examples for your accusations about what I assert when there is a gain for Repubs and all that? I suspect I provide plenty of substantiation for what I assert about what

actually happened and why. But I am willing to review your linked quotes to give it some consideration. ...

Yep, I've said it before, about the "bothsidesist". The dude does not put in the work, to provide support to substantiate any of his claims / arguments. Next he'll tell ya to go read "book xyz" from "Joe Author", that'll explain all my "say so".

And now he's piggy-backing and riding on Tiny 12 "data / evidence" coat tails, and pawning off the work, as if its his own findings, as if he did the work.