Debt Debate in Congress

[Gaspar]

You all know I am usually the one who is pro corporation/business.  But we are in a unique situation.  And something just seems amiss.  How is it that corporations are sitting on trillions of dollars, and others are making big money (and thats fine with me) while others have been seeing their wages decreas WHILE AT THE SAME TIME (and her is the unique situation) the ones who have (and this having hasnt translated into doing more for the economy) arent being asked to sacrifice while the ones who have steadily been making less are being asked to sacrifice?

That's a great question Artist and actually an easy one to understand.

Before the recession there were more businesses.  For example, if I sell widgets and I have 27 competitors who also sell the same widget, I have to compete on price and quality.  We all have small manufacturing operations and employ about 27 people.

Recession hits and the smartest, and best financially managed of us survive.  We have all layed off half our workforce.  Now there are only 6 widget companies, and the demand for widgets is still decreasing, but not as much as the supply we are capable of producing.

We are now selling every widget we produce, and because of the limited competition, we can ask a little more for them!  Yeah for us!  We are making more profit, because we have eliminated expenses.  With the additional profit we have to make a decision. . .do we expand to meet demand, even though the demand is decreasing?  

Well, if we decide to expand, we will want assurance that the market will turn around at a rate that meets our investment in expansion.  Unfortunately this is the indicator that is missing.  Therefore the smart business sits on it's cash because of the risk.

[nathanm]

Most of those breaks did little or nothing for Job Creators.  They were targeted at individuals, and failing industries.  They were designed to delay decline, and they weren't enough to do that. 

Mmmhmm, just yesterday you were complaining about losing accelerated depreciation and now you're saying that producers of calue got no tax cuts.At least try to be consistent for a week at a time, please.

[Gaspar]

Mmmhmm, just yesterday you were complaining about losing accelerated depreciation and now you're saying that producers of calue got no tax cuts.At least try to be consistent for a week at a time, please.

Nothing wrong with accelerated depreciation!  That's a great stimulus example that works, but we didn't extend enough of it, and what we did extend was not a job creator.  Section 129 allowed for some serious investment by corporations, but it didn't spur the growth of new corporations.

. . .Also didn't increase hiring.  We profited quite a bit from the Section 129 changes (extended from the Bush tax cuts) because companies were looking for ways to expand without the risk of hiring.

[nathanm]

Section 129 allowed for some serious investment by corporations, but it didn't spur the growth of new corporations.

Allowed for, but failed to have a significant effect. Face it, there's a long list of tax cuts, extensions of previous tax cuts scheduled to expire or phase out, and tax credits for business that have been enacted since 2008. Fat lot of good it's done. We did what companies asked, they failed to keep up their end of the bargain, whether because they don't like the economic outlook or for whatever other reason. It's time to try something different.

[Gaspar]

they failed to keep up their end of the bargain

No one promised to hire just because the government threw them a bone from the meat it already takes from them.

Sprinkling a few tax deductions on a giant Keynesian toilet load, does not make it any more palatable, it only gives President Obama the excuse "hey look, tax cuts don't work."

Welcome back Carter!

[heironymouspasparagus]

But it is still the same old reality - tax cuts DON'T work.  At least not by themselves.  As we have proven time and time again.

And it still goes to the same old thing - lack of awareness of history.

[nathanm]

Sprinkling a few tax deductions on a giant Keynesian toilet load, does not make it any more palatable, it only gives President Obama the excuse "hey look, tax cuts don't work."

Giant Keynesian toilet load? Half the money went to tax cuts, and the other half included a UE extension, extra Medicaid money and a couple hundred billion in supplementary funds for state/local governments. Scanning the list of expenditures on Wikipedia, about $121.5 billion went to building and buying stuff.

Your perception is grossly in error.

[Conan71]

When they're temporary, they don't add significantly to the long term budget problem. If you recall, I have been saying all along that tax cuts are dumb in this environment. If QE doesn't work, why would we think that another form of dumping cash into the economy is going to help?

Conan, you can either believe arithmetic or not. Apparently, you have decided not. Sad.

Keep on back-pedalling, Nate.  You were the one who said tax cuts were NOT a part of Keynesian economics.  Faced with the facts that John Maynard Keynes himself believed this, you continue to dance around the issue and make innocuous comments on what I believe.  Just admit you were wrong and move on, dude.  I guess you think Keynes should have paid attention to Nathanian economics.

[Teatownclown]

Tax cuts NEVER created any jobs....move on.

[Gaspar]

Giant Keynesian toilet load? Half the money went to tax cuts, and the other half included a UE extension, extra Medicaid money and a couple hundred billion in supplementary funds for state/local governments. Scanning the list of expenditures on Wikipedia, about $121.5 billion went to building and buying stuff.

Your perception is grossly in error.

Yes, and half of that was spread into a thin layer on individual payroll tax.  Keynsian economics would dictate that that money would be immediately re-invested in the economy, but reality dictates that when an individual sees his income increase marginally in the midst of economic crisis with the threat of unemployment looming over his head, he does not go out and buy a new boat!  That's exactly what happened!  Remember the pleas for people to go out and spend money?  Get a nice meal at a restaurant, take that vacation to Mane, buy a motorcycle.  

We are not cattle.  If you give us more feed, we don't necessarily produce more manure. Sometimes we just fatten up for a rainy day.

Face it, when your employer is happy and healthy, you are happy and healthy because you know that your livelihood is safe, and perhaps you can ask for a raise.

When your employer is struggling, you feel like a goldfish living in a blender.  Even if the Imperial Federal Government grants your employer the ability to deduct less from your check, you know that doesn't make your job any more stable.

Bush tried this same garbage with dismal results.

Tax cuts have to have profound effects on the job creators, employers, and the energy they require.  The stimulus was tiny carrots fed to the wrong bunnies, and did nothing to overcome the sticks.  Massive sticks in the form of perceived punitive healthcare, tax, and energy costs.

[Teatownclown]

Not cattle....sheeples.

Looks like interest rates are going up.....hold tight. You'll look back someday and realize we are currently witnessing the self destruction of the GOP/Teabaggers. Higher interest rates will just help the rich get richer. After all, they don't have to incur debt.

Such vacuous thinking. Eric Cantor? What an idiot...

[nathanm]

Keynsian economics would dictate that that money would be immediately re-invested in the economy, but reality dictates that when an individual sees his income increase marginally in the midst of economic crisis with the threat of unemployment looming over his head, he does not go out and buy a new boat!  That's exactly what happened!  Remember the pleas for people to go out and spend money?  Get a nice meal at a restaurant, take that vacation to Mane, buy a motorcycle.  

Wow, you could be quoting Keynes. This is precisely why Keynes favored government spending over tax cuts/rebates/what have you for stimulating an economy. Funny that you imply the opposite.

[Teatownclown]

Wow, you could be quoting Keynes. This is precisely why Keynes favored government spending over tax cuts/rebates/what have you for stimulating an economy. Funny that you imply the opposite.

Have you ever noticed that if their minion is too few in numbers they go silent....talk about a bunch of co dependents. LOL.

Now, with Moody's talking downgrade, the GOP will start to feel some intense heat from their backers. 3 days of significant losses on Wall Street over the brinkmanship and uncertainty add up to massive pressure to get this over with. And McConnell's plan to go through this every six months (for six months at a time?) is a non-starter from every side (way to go Mitch!)  Orangeman, Boner, is way out of his league. And faced with a frankenstien problem from hell. The outside agitators that were ginned up to harrass Obama and kill HCR, have taken on a life of their own, and worse for Boner, they have assimilated Cantor, who has designs on Boner's chair.

Cantor Lied About Debt Talks
http://www.politicsplus.org/blog/?p=5384

We can all agree that they all lie...they all lack integrity....including Potus Obuma.

[RecycleMichael]

Calling people names like Orangeman Boner is just disrespectful. Please try to tone down the rhetoric on this forum.

[Teatownclown]

Hey, I get that terminology off MSNBC.

That's a wrap.
I ignore getting bullied. Buh Bye!