2006-02-03
Cuts in Tax Rates Cause Increase in Tax Rev
Oddly, Nadir agrees that cutting property tax rates in Philidelphia resulted in increases to home property values, and thus increases in tax revenue (a smaller fraction of a larger pie represents a bigger piece of a pie vs. a larger fraction of a smaller pie). Yet he does not believe that congress's passages of Bush's proposed cutting of tax rates "on the rich" resulted in growth of federal tax revenue. Here's one of the charts showing that federal tax revenue increased following the Bush reduction of tax rates. An earlier post on this issue showed that despite this increase in tax revenue, federal spending increased by even more, resulting in the growth of federal deficit. Repealing the Bush tax cut, as Nadir and other leftists have called for, will surely result in a reduction in tax revenues. Demanding instead a reduction in federal spending (including if you like an eradication of the Iraq war spending) would contribute to reducing the federal defict; raising tax rates will not!
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4 comments:
Also check this out:
http://www.brendan-nyhan.com/blog/2005/12/the_treasury_de.html
It doesn't matter that tax revenue increased a little when spending on stupid imperialist miltary invasions increased or when corporate welfare increased or when deficit spending increased a lot. Putting two more pennies a day into the jar doesn't help when you're deducting a nickel every three hours.
These tax cuts have increased the tax burden on the middle class and the poor. Why shouldn't the rich invest in America just like the rest of us do? Instead they are given incentives to invest in China and India or in makingg themselves richer? This leaves the poor, the working class and the middle class to fund public infrastructure that is used by the rich to build their stadiums and their vacation homes.
====Nadir===
These tax cuts have increased the tax burden on the middle class and the poor.
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According to your brain, but not according to the facts. The tax cuts resulted in more tax income. The budget increases resulted in more tax spending. Repealing the tax cuts will cause tax revenues to shrink; *that* will increase the tax deficet. (I don't know what you mean by "tax burden" above. The middle class and poor are *not* paying a greater percentage of their incomes in taxes.)
====Nadir===
Why shouldn't the rich invest in America just like the rest of us do?
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Apparently for you "invest in America" only means "pay taxes". Accepting this definition, the Bush tax cuts don't cause "the rich" (such as your wife's 401k account) to pay less taxes than "the rest of us". It causes them to get taxed at the same rate as "the rest of us", but to continue paying not only more taxes than "the rest of us", but even more total taxes than they would if you succeeded in increasing their tax rates.
Think about the rate you charge for your CDs: $10 per CD. Oh, never mind. Re-read any of several previous posts by me, or read an economics text book.
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