sun editorial:

Tone-deaf economic policy

As average Americans struggle, Bush seeks permanent tax cuts for the very rich

Friday, June 6, 2008 | 2:07 a.m.

Once again, President Bush is promoting his tax cuts for the wealthiest Americans, despite the fact that his nation is at war, the deficit is growing, its housing market has tanked and people are choosing between buying gasoline and food.

Bush stumped for the cuts Monday, the five-year anniversary of his signing of the Jobs and Growth Tax Relief Reconciliation Act of 2003. The law, which lowered tax rates on capital gains and dividends, is set to expire in 2010.

After meeting with the Council of Economic Advisers, the Associated Press reported, Bush said the “best way to deal with uncertainty is to let people keep more of their money.” Bush said Congress should make his cuts permanent because they “have been an engine for economic vitality.”

Whose economic vitality? The nation is beset with rising unemployment, stagnant wages, rising food and energy costs, and a home mortgage crisis of epic proportions. USA Today reported last month that about 27.5 million Americans rely on government aid to put food on their tables — a number experts predict will continue to rise.

And as millions of rank-and-file Americans struggle to make ends meet at home, tens of thousands of others are overseas fighting Bush’s Iraq war, which has been a five-year fiasco.

Is it any wonder that congressional Democrats have no interest in renewing tax cuts that apply to only the wealthiest of the wealthy? Bush has some nerve to keep pressing for them.

Edward Lazear, chairman of the president’s Economic Advisory Council, said allowing the cuts to expire will amount to a tax increase for those affected, and tax increases in a sluggish economy aren’t good policy. “We can’t ignore the reality, which is that we are in a slow-growth period right now,” Lazear said this week.

The Bush administration has become quite adept, however, at ignoring reality, particularly the plight of millions of Americans who are worried about being able to adequately feed and house their families.

Discussion: 13 comments so far…

By LV_Tom

6/6/08 at 10:21 a.m.

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Hmmm..... Now let's see. How many governments have taxed themselves into prosperity?

Greed is one of the Seven Deadly sins..... but so in Envy... I see a lot of Envious liberals out there.
By thebs

6/6/08 at 11:35 a.m.

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Bush has blessed the rich with tax cuts while relying on massive deficit spending to finance subsidies for oil companies and his failed war on Iraq.

The rationale for the cuts, that they would spur growth and spending has failed, as most Democratic leaders portended.

LV_Tom tries to obfuscate the issue with name calling, but we're already reaping the heavy consequences of Bush's failed economic policies.
By NVMakz

6/6/08 at 11:42 a.m.

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Liberals believe government does things, anything, better than "the people" and especially, the private sector. This IS how delusional liberals are, at the core of it.

Liberals believe that seizing more money from the real wealth generator, the people / economy, and handing it over to the most wasteful, inefficient entity money can land, a bigger, socialist-style system = is the way to go.

Insuring shared misery, more political oppression and corrosion of the national soul = is the aim here by the Socialist Sun and its moonies....

The rich provide the economic momentum that drives the greatest nation on Earth. The rich provide jobs, earnings and futures for the people, government, well, lololol............

The top-25% of taxpayers pay 87% of all Income Tax receipts. The rich have paid MORE in tax receipts since the Bush Tax Cuts went into effect - due to greater economic activities in the private sector. WHY would the liberal want to further burden EVERYBODY with more?? Because they're corroders among us.

Being the Socialist Sun is the "failing newspaper since 1998" in town gives we all a chance to see destructive politics each day.

The only thing tonedeaf here is the liberal belief that as nations around the world lower taxes, go to a flat tax, start to turn around the failures of socialism / communism - and elect more conservative governments and leaders == the Socialist Sun and the Democrat party (small p) want America to go toward the very political systems which have been proven failures time and time again.

Lower taxes and constrained spending is good in the family and better for national governments. The people ARE the wealth generator, not the failure of government programs and initiatives.

Higher taxes impose more constriction and more oppression - as has been more than proven around the world.

As the liberal punishs the poorer population FIRST with constricting energy supplies and leaving America too close to enemy governments; efforting to get America in the failure which is Kyoto / global warming facism; attack free speech and the Bill of Rights / Constitution each and every day == The Socialist Sun today disgraces itself once again by supporting government over "the people".
By NVMakz

6/6/08 at 11:44 a.m.

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"the bs":

Your nonsense is "duly" noted.
By JohnF

6/6/08 at 12:49 p.m.

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LVTom, NVMakz,

Wrong, wrong, wrong. The conservative believes that government can never do anything better than the private sector. The liberal, and I am one of them, believes that there are things the government can do better than the private sector. We always look for market solutions first, but settle on government involvement when the problem must be addressed but the private sector either can't or won't do it.

Take, for instance, medical insurance. I believe that everyone has a right to be treated for illness. However, there are nearly 50 million people in this country without any medical insurance. This is a failure of the market-based system. I don't blame insurance companies or the doctors; the problem is systemic.

So what do we do for those who are either not profitable to insure or can't afford health insurance? The liberal in me believes society is best served by providing these people (like the elderly) with insurance. I realize this is a redistributive process, but I believe the societal good served by medicare, for instance, outweighs the evil of taxing you and me to support it.

The same goes for clean water and clean air legislation. Left to itself the market would never pay for pollution controls. But we are certainly better off for having such regulations in place.

As for your contention that the rich are the source of all investment and therefore all jobs, you're forgetting a couple of things. First, tax rates on the wealthy are already lower than they have been for many decades. In 1952 the top tax bracket was 92% and it has been declining steadily ever since to its current rate of 35% (it actually fell to 31% during Bush I, went up to 39.6% during the Clinton administration, and is back down now). Prior to the Reagan presidency, the last time the top tax bracket was below 60% was during the Hoover administration. During the 50's and early 60's, when economic expansion was greatest, the top tax bracket was about 90%. So obviously taxing the wealthy heavily does not necessarily stunt ecenomic growth.

Second, saying that we need to have money in the hands of the rich to spur economic expansion is just more supply-side claptrap; it ignores the fact that the economy is demand-driven. We can give the wealthy all the money we want, but unless the middle class have the money to buy things, nobody, no matter how wealthy, is going to produce anything. The way to spur production and create jobs is to put money in the hands of those who will spnd it on consumer goods and services.
By thebs

6/6/08 at 1:09 p.m.

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Ah, NVMakz, my little baby cyberstalker.

Throughout your multi-paragraph drivel, you take no responsibility for the current economic woes, such as they are. You whine and whine about the socialist - or communist - or Marxist - or fascist - or whatever dumbed-down and misunderstood "ist" label you choose for the day but don't address the salient issue: Bush's economic policies have failed.

Much like his doctrine of preemptive war, Bush's misguided and maligned "Tax Relief for Sheldon Adelson and George Soros" plan failed to provide the "economic momentum" you covet. Instead, thanks to the tone-deaf economic policies of the past seven years, we're mired deep in inflated oil prices, a mortgage meltdown, rapid dollar devaluation, and deficit spending.

0 for 4, so by your math: Mission Accomplished!

The momentum of Bush's failed policies have us hurdling in the wrong direction.

So please explain how tax relief for Sheldon Adelson's personal billion dollar fortune helps the poor. That's, essentially, what you're arguing.

But you won't, you'll continue to mislabel Democrats with ideologies of which you have no understanding. You've made that abundantly clear. You'll fail to defend Bush's economic policy (the real issue here) and call attention to red herrings like Kyoto.

I look forward to your half-baked and grammar-challenged response, but do try to stay on topic.
By NVMakz

6/6/08 at 1:17 p.m.

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"JohnF":

More socialist claptrap, as you place it.

Para #1: The liberal never "looks for market solutions first". Govt is the end-all and be-all. Thanks for the laugh!!

Med Insurance: As governments around the world are cracking under the rationed-care / waiting lines and scarcity of care = which has become global Universal Health Care - the American lib wants to drive this govt oppression on all of us. Med Insurance is NOT a "right", it is a product. It is un-American and pro-socialist to take away from me the best I can obtain - force me into an inferior system in which i have no control over my care and call it progress. It is a government assault on my rights and typifies the un-American nature of the lib-Dem.

Para 3: Care for every American (and the millions of illegal aliens the lib has pimped into our system) is available via emergency rooms. Face yourself = this is just a (D)-socialist attack on the American way of life and our stability as a nation.

"jobs and taxes" - you must be quite young. The days of the top bracket of 60-90+% ALSO provided for massive amounts of loopholes, writeoffs and breaks which were removed and revamped under the Ronald Reagan / Tip O'Neill code changes of the 1980s. Lower tax rates, less writeoffs and a much cleaner tax code then - under assault by the liberal ever since. Your "(para) taxing the wealthy heavily didn't do much harm" is sheer balderdash. To think you're SO uninformed on this is simple and easy to do.

Last para: Backing much more money, power and largesse TO the government is moving in the direction of socialism = which has and is failing around the world. Yet, da lib wants to drive us there. Sad, delusional. The "people" are the wealth generator. The government is a wealth sucker, proividing servece which would be rejected if it was a private company. Politicians, especially liberal / socialist ones, would be long fired if compared to private-sector influences.

Your last sentence betrays your whole premise. It's "the people" who generate economic activity and tax revenue by purchasing and investing. Government is a financial black hole which the liberal wants to make much bigger and more oppressive for all of us.

Power to "the people" left to make their own choices and investments. Government and its oppressions are the provence of the liberal social communist......
By NVMakz

6/6/08 at 1:33 p.m.

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"the bs"

nice to know I am under your skin = cyberstalker...

The economic woes are exaggerated by the liberal "for a few seats more". "the bs" of anti-American socialism stains your brain.

Oil prices: liberals, aligning with America's global enemies and their storm-troopers, the enviroMENTAList - want gas much higher than it is while forcing we all closer to those who want us dead by choking and constipating supplies which the "5% global growth" moves we all to energy collapse. Even your delusion-soaked soul can't refute this.

Mortgage "meltdown": What a sick delusion. Are you rooting for this as well? 96.8% of all American mortgages, even with the problems among those who signed hinky mortgages - are in no trouble at all and are current acc to the Fed and a cross-section of information out there now - none of which you would understand. You root for the 3.2% of the people who did this to themselves to grow. Sick!

The dollar is stabilized and rising slowly - and the national deficits have been falling over the last 2-3 years. Guess you're not that informed. Liberals tout suffering and destruction, as your screeds prove.

Your last paragraph and a half is simple frustration with being whacked, overall, by me and the poison of having facism, socialism and social communism - all of them - as your sad and sorry political basis.

Socialist, social communist, facist = it's great to know those concepts are in your head. It generates your op-ed drivel.
By thebs

6/6/08 at 2:04 p.m.

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So no defense of Bush's deficit spending? I guess even someone as delusional as you has to recognize when Bush runs this economy into the ground.

The Mortgage Banker's Association reported this week that 6.35 of all mortgages are at least 30 days past due. This is a 10% rise from the previous quarter, a 25% increase from the same time last year, and a is an all-time high. The number of foreclosure starts is at a 29-year high. Yeah, no problem there. Keep sucking your thumb and ignoring the obvious.

Additionally, while 50% of the current foreclosures are sub-prime, 42% are prime, which means it's not just the speculators being hit. More NVMakz myths debunked.

You're also terribly misinformed about the dollar and current events. With oil prices spiking due to the ever-weakening dollar, TODAY. Don't let reality stop you from your crazy ranting, read the link below !

"Investors have once again sought the refuge of crude oil as the dollar plunged against the euro, and oil prices have surged in the past two sessions as a result."
http://online.wsj.com/article/SB12127469...

The dollar is stable only in your tiny, tiny mind. Honk! Honk! Oil prices are inflated due to the poor energy polcies and inflated securities market. You can drone on all you want about your perverted fantasies of the liberal mindset, but oil prices are a direct result of Bush's failed energy and monetary policies.

You aren't "under (my) skin" so much as a constant source of amusement. You continue to be woefully uninformed. Get your head out of the Investor's Business Daily and start seeing reality. My last paragraph and a half you can't refute because it's the truth: you rely on red herrings and misunderstood political ideologies in the guise of actual reasoning. You're transparent and sad, really. And nobody likes a sad clown, NVMakz.

Honk! Honk!
By JohnF

6/6/08 at 5:05 p.m.

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NVMakz,

My last sentence bespeaks the need for putting more money in the hands of the middle class, not tax cuts for the wealthy.

The idea that medical care is just a commodity is absurd. It's like saying food and water are commodities. Further, the notion that care is available for anyone at the local emergency room is just as absurd. There is no preventive care there. You can't go to an emergency room for a prostate exam or a pap smear, nor can you go to an emergency room for chemotherapy.

If national health care in Europe and Canada provides their citizens with such poor quality health care, why are their infant mortality rates lower than ours? Why are their life expectancies greater?

As for forcing you into a health care program, can we assume, then, that you will refuse medicare when it's time to retire? If so, good luck finding someone to insure you.

The bottom line, again, is that there are things necessary for the proper functioning of a society that a free market simply won't do because it isn't profitable. Among them are: providing for our defense, building a highway system (especially in rural areas), protecting our air and water, providing medical care for the elderly and the indigent, providing police and fire protection (again, especially to rural areas), etc., etc. According to your conservative doctrine government shouldn't do any of these things.

Without liberalism there would be no social security, no medicare, no public education, no national parks, no federal highway system, no electricity in rural areas, no voting rights act, no clean air or clean water laws, no FDIC, no FSLIC, and on and on. Oh yeah, liberals have also given us balanced budgets. I'll stack that legacy up against anything coservatives have given us in the last 75 years.
By odeman

6/6/08 at 11:09 p.m.

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Sooner rather than later, government will have to raise taxes and cut spending. The debt in this country is staggering and getting worse by the day. Saying deficits are getting smaller is not a positive. It still means we owe more than we take in, plus we pay compound interest on it. If we buy the argument that no government taxed their way to properity, then we should cut taxes to zero and we will live long and prosper. Not. We are prospering now because we are exploiting the rest of the world to get cheap goods and to have them finance our lifestyle. If we do not get our house in order the countries financing our spending binge will cut us off when they figure they can do without us. That day is getting closer. Just as so many Las Vegas homeowners have found out, eventually the bills have to be paid or suffer the consequences. Unlike the homeowner who can't pay, the US government can't hand over the keys and walk away. Although the upper income people supposedly pay the majority of the taxes, billionaire Warren Buffet says he pays a lower percentage in taxes than his secretary does and he says that is not right. Social Security and Medicare are said to be going broke, yet the taxable income cap on these is somewhere in the $90 thousands, which means all money made over that is not subject to SS and Medicare taxation.
By jfnance32

6/7/08 at 10:59 a.m.

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Big government lovers please listen.

It is in your interest that we have strong steady economic growth.

If you raise taxes and if it reduces economic growth rate then in the long run you will get less taxpayer money to spend and waste.

Russia destroyed its economy with communism. Even though Russia has a very large population and vast treasury of natural resources its GNP is so small that it only equals the state of Connecticut.

The GNP of US is so large that is 3 times bigger than the 2nd ranked country of Japan. It is so big that US GNP is larger than the next 8 countries combined.

One should understand the compounding effect of economic growth.

Let’s say taxing the rich reduces the growth of the economy from 3% each year to 2% each.

Let’s say today the size of the economy is $100 and the government gets $35 (35% net tax rate) of that.

Let’s say after the tax increase it will start getting $35 (37% net tax rate) of that.

In the tenth year at 2% growth the economy will be $122 and the government will have gotten $45 dollars @ 37% tax rate.

In the tenth year at 3% growth the economy will be $134 and the government will have gotten $47 dollars @ 35% tax rate.

In the tenth year, the big government spenders would have $2 less to spend and waste. The taxpayers would also have $12 less to spend on stuff like food, gas, housing, etc...
By thebs

6/7/08 at 5:49 p.m.

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You miss the core issues, jnfrance. This isn't about loving or expanding government. Certainly an argument can be made that lowering taxes increases growth. There's an economic equilibrium, though, between low taxation and growth. At a point, lowering the tax rates can't effectively spur growth.

Bush's economic policy has shown that simply reducing taxes on the superwealthy does not result in the market expanding at an increased rate. Instead, the gap between the wealthy and the middle class grows, wealth is concentrated and true growth, that of the middle class, stagnates. That's the current economic outlook.

It gets worse when you recognize that Bush is financing his war on Iraq with deficit spending. It's something NVMakz cannot even justify.