Оккам с его бритвой - великий человек,

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- Независимость - это когда в 20-й раз наступаешь на одни и те же грабли, а русские уже ни при чем....

IntensityInsanity:

AHTOH:

 II, like they say, follow the money. It would be rather illogical to try to collect additional tax revenues from the poorest segment of the population. What are you going to take from them? Their shiny spinning rims? Bling bling and fake watches? Unused food stamps and used formula bottles? Now, I do agree there are abuses in the wellfare system, but to say that it is the major fall of the economic issues is dishonest. We need more taxable revenues to supplement federal budget? Go after those who can be taxed - namely the top earners and the businesses. Yes, I know, how "socialist" of me, right? I mean, to think that being rich and ejoy life, or have a successful business here in this country comes with some sort of responsiblity? Totally socialistic notion. Borderline Marxist.

Anton, though I was sorta just giving a statistic and really an opinion, you probably sensed some hostility in what I wrote, misleading you to believe that I think we should try to collect more cash from the poor.  Not so.  The hostility is more toward the (relatively huge) crowd that not only pays nothing, but actually receives money.  Earned income credit, etc - you know what I'm talking about.  So you say, "but dear II, that is so cruel.  These people are so poor that we need to help them out.  And remember, it's also for the children!!".  For really legit cases, I am not against this little 'wealth redistribution' but the reality is this:  if you walked into the homes of the above-mentioned crowd, at LEAST 75% of them will have 'luxury' items such as LCD TVs, expensive cell phones, cable/Satellite, etc.  Of course there's other stuff too:  cigs, weed, other drugs, etc.  All this stuff is subsidized by all the people who actually do pay taxes.

Your 'socialistic' humor has this problem:  yes, of course even on a flat tax, the rich will pay more.  So certainly with a progressive tax system like we have here, the rich will pay a huge share of the tax burden.  However, I believe it shouldn't be as extreme as now (see above paragraph as an example where we can start), and furthermore, there are right and wrong times to raise taxes on the 'rich'.  Right now, for instance, we are in a really shitty economy, and very high unemployment.  I could explain this, but I assume you understand this stuff as it's pretty basic.  By the way, this is why Obama is a complete idiot, if even for nothing else.  All the tax raising on rich (regardless when it goes into effect, just all the talk of it achieves similar levels of disaster) is the absolute wrong thing to do at this time and Obama and all his kool-aid drinkers (like you, Anton) seem to miss this.

II, but you are still off the mark. You are focusing so much attention and efforts on some rather banal class warfare. Especially bringing up earned income credits. At least some of those people did have income. Others don't (like the article here http://online.wsj.com/article/SB10001424052748703954804575381270905814374.html?mod=WSJ_hps_MIDDLESixthNews)

While examples like these are unjust and may be seen as outrageous, this wellfare spending accounts for but a small portion of various special interest accomodations - like rich people hiding money offshore, businesses paying 10-15% effective tax rate (vs. 35% mandated rate), trillions wasted in Iraq and Afghanistan, trillions in tax cuts for the top rich, hundreds of billions to TARP bank recepients in the form of bailouts, etc. You seem to be after the "small fries" while completely overlooking the big picture. Taking the earned income credicts away is not going to help close the budget deficit. Going after illegal immigrants is not going to solve trade deficit, or stop offshoring of good American jobs overseas.

You also seem to believe the idea of "trickle down economics", which promotes the idea that if we really pamper our super rich, some crumbs off ther table would eventually make their ways down to middle class...Are you like all excited, waiting? Is this the modern economic principle you embrace? Please the rich and hope for their good graces, essentially? So who is the Koolaid drinker, after all?

The businesses are struggling because the lending essentially stopped. I am in the industry, working in finance dept for a middle market corporate. Unless you are investment grade rated, you won't get any loans  - this is what's really killing small businesses around the country. Historically, small businesses here survived due to their relatively high financial leverage (debt/assets). Once the music stopped, many went and are going bust, laying off people and shutting down. In the past, banks would lend money to these non-investment-grade shops, but since the defunct zombie banks were bailed out instead of being shut down, the weight of banks bad debts is still weighing on the economy. The banks are trying to earn their way out of the losses, by taking ZERO risk (not lending) and instead borrowing from the FED at 0.25% and investing these money into stock market, hedge funds, derivatives and Treasury Bills (which is essentially lending the government ITS OWN MONEY). Had the Congress let the failed banks fail, there would be new banks formed rather quickly to pick up the slack in the market. That did not happen, and what we have ended up with is a large number of too-big-to-fail crooks who are not performing their ESSENTIAL function of efficient capital distribution, but instead relying on GOVERNMENT WELLFARE for their survival. And you thought blacks had it easy...Wake up and look around you. Like Thomas Jefferson once noted:

I believe that banking institutions are more dangerous to our liberties than standing armies. If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around [the banks] will deprive the people of all property until their children wake-up homeless on the continent their fathers conquered. The issuing power should be taken from the banks and restored to the people, to whom it properly belongs.

What a Koolaid drinking Socialist! </sacrasm off>

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Sic semper tyrannis
~War is Peace~Freedom is Slavery~Ignorance is Strength~ George Orwell "1984"

AHTOH:

While examples like these are unjust and may be seen as outrageous, this wellfare spending accounts for but a small portion of various special interest accomodations - like rich people hiding money offshore, businesses paying 10-15% effective tax rate (vs. 35% mandated rate), trillions wasted in Iraq and Afghanistan, trillions in tax cuts for the top rich, hundreds of billions to TARP bank recepients in the form of bailouts, etc.

So you are not really a liberal?  Because the negative factors you listed, except for one,  are supported by liberals and Obama, or not actively opposed.  I am not big on these labels, but since you showed up here after all these years with an "I'm now a liberal"..  You don't really seem to be very much in touch with contemporary liberalism :) 

I actually agree with some of what you are saying in this post, but there is a grandiose misconception, that also exists in the psyche of a varying percentage of the public, and has many times already threatened US prosperity. And that is the perception that the money injected by "the rich" into the economy, and ensuing benefits to all individuals under that economic system, is, in essence, some sort of charity.  "Crumbs" even.

Perhaps it is a failure of our education system, that cannot, in a high school economic course, teach adequate people that investment capital, by definition, is not charitable. Rather, it is an investment with purely selfish initial motivations.  It is an unavoidable side effect (not "crumbs") that this will provide income, benefits, and a quality of life surpassing 99% of world's population to x number of Americans, that it will create for the society a product or service that is in demand, it will generate tax revenues for the government in a self-sustaining chain reaction of transactions.  The system is invented already, and proven successful. 

You mentioned outsourced jobs, outsourced operations, and offshore assets.  How can you not see that this will be proportional to, in a major way, the tax rate levied on these decisionmakers and their operations?

Most politicians (and people) are either against all tax cuts in all situations, or for them in all situations.  Clearly, the rate cannot be 100%, and cannot be 0%.  The balance must be a factor of how badly we want to stimulate the economy.  Everyone agrees (i hope) that there is an effect on the economy from the tax rates, either a stimulative, or retardant.  Why would you then move on the scale towards retardant in the middle of a major economic slowdown?

Finally, I would submit that the only reason banks are not lending is the low interest rates.  All other reasons would go straight to hell the moment interest rates make lending an effective vehicle to profit.  Banks are profitable today, including the bailed out ones.  Had they been lending more, they wouldn't be.  Its that simple.

P.S. on the quote from Jefferson.. You are aware, aren't you, that banks do not issue currency in the US?   

 

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"The trouble with socialism is that eventually you run out of other people's money" -Margaret Thatcher

by the way, i didn;t have time to reply last week.. On the cost of a closed border, and the effectiveness, etc..

People keep repeating that its anaffordable.  Have you bothered to calculate something, compared it to other costs for the governemnt, etc?

Of course we can;t calculate it exactly, but lets try to put things in perspective.  A good (max.security prison-type) fence or wall costs significantly less than a road.  Let's say there are 4 million miles of roads in the US (i can't find a credible number, but this seems to be the "average" estimate).  There is probably 10k miles or so total US land border w Mexico and Canada, which could be made much shorter as the fence doesn't have to be right on the border, it can be inside in more straight lines.  So building 0.25% more roads than we have today (we add way more than that every year) is significantly more expensive than the fence.  Significantly because i rounded and exaggerated in favor of the counter-argument with all these numbers.

As far as  maintenance..  Compared to repaving roads every few years, should be less.  Salaries of enforcement/military personnel is a non-issue, where the hell the National Guard budget is spent today, good luck with your research, if you care.

What is the issue then?

Finally, on effectiveness.  Everyone knows it will not be 100% effective.  War on drugs was brought as an example.  But why not bring - war on rape?  Its not 100% effective.  The difference in the war on drugs, as that it is not really supported "ideologically".  And that is its ultimate undoing.  If it was just lack of results, then we need to stop enforcing all laws that are not 100% effective.  So, essentially, all laws.

The benefit of enforcement of something that is not 100% is simply to reduce the incidents, to provide deterrent to as many as possible, and to have (in this instance) some control over the total flow, and fewer possible methods of entry, diverting resources to better address remaining methods of entry we've all creatively suggested, which simply become manageable security issues at that point.

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"The trouble with socialism is that eventually you run out of other people's money" -Margaret Thatcher

Egor:

So you are not really a liberal?  Because the negative factors you listed, except for one,  are supported by liberals and Obama, or not actively opposed.  I am not big on these labels, but since you showed up here after all these years with an "I'm now a liberal"..  You don't really seem to be very much in touch with contemporary liberalism :) 

I never said I was liberal. I said I have become progressively more liberal. And by the way, Obama is not a liberal either.

 

Egor:

Finally, I would submit that the only reason banks are not lending is the low interest rates.  All other reasons would go straight to hell the moment interest rates make lending an effective vehicle to profit.  Banks are profitable today, including the bailed out ones.  Had they been lending more, they wouldn't be.  Its that simple.

P.S. on the quote from Jefferson.. You are aware, aren't you, that banks do not issue currency in the US?   

Banks are not lending because they are required to cover bad assets with cash reserves. Due to the amount of questionable loans still on the books, without formal losses recognized, banks have to cover with reserves. This is why instead of lending they are hoarding.

Your rate assessment is incorrect. All businesses, including banks, work off their margins. Have you borrowed recently from a bank? Banks lend to each other (LIBOR index) at approx. 1%. (1 year USD LIBOR). Banks lend to businesses at anywhere from 5.5% to 10%+. This is a rather hefty margin. Banks would lend more, if they could. They can't not due to "low rates", but due to lack of funds on deposit.

And by the way, everyone interprets these historical quotes in various context. To me, Jefferson was talking about credit and fractional banking, not specifically about "printing money", but rather creating money from the thin air. But for the argument's sake, fine, banks do not print money. Federal Reserve does, correct? Who owns Federal Reserve? Largest commercial US banks - just look it up. So, banks do control the printing of money as well, as issuance of credit.

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Sic semper tyrannis
~War is Peace~Freedom is Slavery~Ignorance is Strength~ George Orwell "1984"

Egor:

. And that is the perception that the money injected by "the rich" into the economy, and ensuing benefits to all individuals under that economic system, is, in essence, some sort of charity.  "Crumbs" even.

It is crumbs. pure undiluted crumbs... 

Egor:

 

The system is invented already, and proven successful. 

in only one country it is succesfull. ONE...

And I'm sure you know why :) 

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- Независимость - это когда в 20-й раз наступаешь на одни и те же грабли, а русские уже ни при чем....