Category: Contrarian Economics

Everything Obama has done — and wants to do — on taxes in one post

Everything Obama has done — and wants to do — on taxes in one post

The centrality of tax policy to the 2012 election raises the question: What has actually changed in the tax code since Obama took office?

Three of the big bills of Obama’s tenure — the American Recovery and Reinvestment Act (or the stimulus act), the Affordable Care Act, and the Bush tax cuts reauthorization/payroll tax cut deal from 2010 — contain most of the changes that have been passed since January 2009. Let’s run through them, bill by bill. Keep in mind, of course, that Congress writes the laws, and the bills that actually passed only somewhat reflect Obama’s priorities.

Bob Cesca: Repeat After Me: Obama Cut the Deficit and Slowed Spending to Lowest Level in 50 Years

Bob Cesca: Repeat After Me: Obama Cut the Deficit and Slowed Spending to Lowest Level in 50 Years

As I’ve documented before, the CBO reported in January, 2009 that the federal budget deficit for that fiscal year, which began on October 1, 2008, was already $1.2 trillion. President Obama’s additional ’09 spending added another $200 billion to the deficit, bringing the total to $1.412 trillion. Unprecedented and huge, but given the enormity of the financial crisis and the depth of the recession, there weren’t many other options on the table. Add two wars into the mix and there you go.

But since then, deficit spending has dropped precipitously. Why? Chiefly because President Obama signed the Statutory Pay-As-You-Go Act in February, 2010, which mandates that new spending be offset with spending cuts or new revenue. Yes, a Democratic president and a Democratic Congress passed this legislation. Guess how many congressional Republicans voted for the law. Zero. Not one. Perhaps during this week’s debate, Vice President Biden could ask Rep. Paul Ryan who voted against the bill.

Consequently, the president is responsible for the lowest government spending growth in 60 years, according to the Wall Street Journal‘s Market Watch.

I am a job creator: A manifesto for the entitled – The Washington Post

I am a job creator: A manifesto for the entitled – The Washington Post

I am the misunderstood superhero of American capitalism, single-handedly creating wealth and prosperity despite all the obstacles put in my way by employees, government and the media.
I am a job creator and I am entitled.
I am entitled to complain about the economy even when my stock price, my portfolio and my profits are at record levels.
I am entitled to a healthy and well-educated workforce, a modern and efficient transportation system and protection for my person and property, just as I am entitled to demonize the government workers who provide them.
I am entitled to complain bitterly about taxes that are always too high, even when they are at record lows.
I am entitled to a judicial system that efficiently enforces contracts and legal obligations on customers, suppliers and employees but does not afford them the same right in return.
I am entitled to complain about the poor quality of service provided by government agencies even as I leave my own customers on hold for 35 minutes while repeatedly telling them how important their call is.
I am entitled to a compensation package that is above average for my company’s size and industry, reflecting the company’s aspirations if not its performance.
I am entitled to have the company pay for breakfasts and lunches, a luxury car and private jet travel, my country club dues and home security systems, box seats to all major sporting events, a pension equal to my current salary and a full package of insurance — life, health, dental, disability and long-term care — through retirement.

 There’s lots more and it is all dead on!

Romney’s theory of the “taker class,” and why it matters

Romney’s theory of the “taker class,” and why it matters

For what it’s worth, this division of “makers” and “takers” isn’t true. Among the Americans who paid no federal income taxes in 2011, 61 percent paid payroll taxes — which means they have jobs and, when you account for both sides of the payroll tax, they paid 15.3 percent of their income in taxes, which is higher than the 13.9 percent that Romney paid. Another 22 percent were elderly.

So 83 percent of those not paying federal income taxes are either working and paying payroll taxes or they’re elderly and Romney is promising to protect their benefits because they’ve earned them. The remainder, by and large, aren’t paying federal income or payroll taxes because they’re unemployed. But that’s a small fraction of the country.

A Third of Americans Now Say They Are in the Lower Classes | Pew Social & Demographic Trends

A Third of Americans Now Say They Are in the Lower Classes | Pew Social & Demographic Trends

According to Pew, 1/3 of Americans now consider themselves part of the lower class, but look at the political and ideological breakdown:

While the share of Republicans who place themselves in the lower class has increased, the GOP is still underrepresented among the lower classes relative to their numbers in the overall population. Overall about 16% of the lower class identifies with the Republican Party, while the GOP makes up about 22% of the population. In contrast, the percentages of the lower class who identify as Democrats and independents mirror their overall proportions in the country as a whole. A third (34%) of the lower class are Democrats and 43% are independents, while nationally a third of adults (33%) say they are Democrats and 38% are independents.
The survey also finds that the proportion of self-described conservatives who are in the lower class also has surged, rising from 19% in 2008 to 32% in the latest Pew Research survey. In contrast, the proportion of moderates increased from 24% to 30%. A third of all liberals (33%) placed themselves in the lower class, while 29% did in 2008, though this change was not statistically significant.
As a result of these shifts, roughly equal shares of conservatives (32%), moderates (30%) and liberals (33%) say they stand on the bottom rungs of the social ladder now

So, clearly the 47% of moochers are across the political and ideological spectrum, contrary to Mitt Romney’s suppositions (fantasies?) 

 

Daily Kos: In defense of red state socialism

Daily Kos: In defense of red state socialism

 Support for Republican candidates, who generally promise to cut government spending, has increased since 1980 in states where the federal government spends more than it collects. The greater the dependence, the greater the support for Republican candidates.

Conversely, states that pay more in taxes than they receive in benefits tend to support Democratic candidates. And Professor Lacy found that the pattern could not be explained by demographics or social issues.

Why Can’t We End Poverty in America? – NYTimes.com

Why Can’t We End Poverty in America? – NYTimes.com

Interesting piece on the failure to eradicate poverty and its growing pervasiveness and persistence.

One of the things that always strikes me in analyses like these, and indeed, in comments like Mitt Romney’s, “I want everyone to have a house like this,” referring to a mansion owned by the Papa John’s Pizza founder, is the fact that not everyone can be rich. In response to Romney, I want to say, “Really? How much money do you propose we pay school teachers in order for that to work out?”
In the case of your piece, and many others, is the call for a better educated or more skilled workforce. This, unfortunately, reminds me of Judge Smails’ comment in Caddy Shack, “The world needs ditch diggers, too!” There will be huge swaths of the population that will continue to work in food service, cosmetology, retail sales, and so on. Until we have a minimum wage structure that supports lifting so many of these people into the middle class, poverty will persist.
I do not know the answers, and I applaud you for positing some very constructive ones, but I am afraid that until we acknowledge that we do have classes of workers, and that we would all be better off if the lower classes were supported more by better social services, better minimum wages, access to health care and so on, we will not be able to ask the right policy questions.
Cheers,

They have our backs. We should have theirs | The Incidental Economist

They have our backs. We should have theirs | The Incidental Economist

I earn much more money. Some might conclude that I am the superior contributor to American society, simply because I hold a more lucrative job. After all, my tax dollars support a social safety-net that tow truck driver’s family might use: the Earned Income Tax Credit, Medicaid, CHIP, and more. Yet this truck driver and that IDOT guy operate a safety-net for me, too, which I used when I encountered trouble along the road.

Much important work is done by people with sore backs and calloused hands who don’t get paid that much, but who pick our fruit, diaper our kids, prepare our meals, drive our kids to school, and more. My brother-in-law was recently hospitalized with a minor infection. In the next bed over, two nurse’s aides gently cleaned a very-sick uninsured man. I’ll probably need that help someday, too.

Each of us is both a maker and a taker in life. I shouldn’t apologize for my good paycheck. I shouldn’t object, either, if I’m asked to pay a little more so that these tow truck drivers and nurse’s aides have access to decent medical care. They have my back. I should have theirs, too.

Papa John’s: ‘Obamacare’ will raise pizza prices – POLITICO.com

Papa John’s: ‘Obamacare’ will raise pizza prices – POLITICO.com

If you thought Obamacare was going to be expensive, Papa John’s is here to show exactly how little an effect on businesses it will be to buy health insurance for employees –  less than 15 cents a pizza! As Pete Townshend once said, “I call that a bargain, the best I ever had!”

Pizza chain Papa John’s told shareholders that President Obama’s health care law will cost consumers more on their pizza.

On a conference call last week, CEO and founder John Schnatter (a Mitt Romney supporter and fundraiser) said the health care law’s changes — set to go into effect in 2014 — will result in higher costs for the company — which they vowed to pass onto consumers.

“Our best estimate is that the Obamacare will cost 11 to 14 cents per pizza, or 15 to 20 cents per order from a corporate basis,” Schnatter said.