In yesterday’s Washington Post, Ruth Marcus uses “quack medicine” to describe conservatives’ support for extending the 2001 and 2003 tax cuts. Yet she commits her own economic malpractice. Ms. Marcus asserts that the tax cuts devastated tax revenues by pointing out that “tax revenue fell from 21 percent of GDP in fiscal 2000 to 17.5 percent in 2008. (I’m leaving out the recession-induced plunge, to under 15 percent this year and last.)” This cherry-picked data is highly misleading. Her starting point (2000) was a year in which revenues reached their …
Alan Greenspan recently gave a Bloomberg News interview with Judy Woodruff. His agenda was redemption. Hers was politics. She got what she wanted. In the course of the interview, Greenspan acknowledged the economy was slowing, a more modest appraisal than that recently signaled by his former colleagues at the Fed who see a significant chance of a downturn and deflation. He also acknowledged that “this is not going to be a full-blown recovery.” He noted one reason for the weak recovery is that “an ever-increasing part of the American economy …
Remember President Barack Obama’s promise to the American people not to raise taxes? Forget about it. While the President has already raised taxes on cigarettes and tanning beds, none of that compares to what could happen in January. If you earn income, your taxes are about to go up. If Congress does not act to preserve current law, even the lowest 10 percent bracket will rise to 15 percent. Throw in tax hikes on capital gains, dividends and other tax code fixes, and the American economy is staring straight down …
On May 25, the Fiscal Analysis Initiative of Pew’s Economic Policy Group published an overview of what might happen to the federal government’s annual deficits should the tax relief of 2001 and 2003 be allowed to expire, be extended through 2012, or be made permanent. As readers may know, all of the tax relief currently in force will disappear by law at the end of this year. Unfortunately, Pew’s report does little to inform policy makers on the awesome economic decisions they are about to make. Had it focused as …
In his Jimmy Carter-esque “New Foundation” speech Tuesday, President Barack Obama linked health care reform and deficit reduction claiming: “If we want to get serious about fiscal discipline … we will also have to get serious about entitlement reform. Make no mistake: health care reform is entitlement reform.” Problem is, Obama’s health care reform plan includes a Medicare-for-all like public plan that will “compete” with private plans. The idea that the path to reduced health care spending must go through expanding Medicare is laughable. former Political Science professor at the …
Budget Trickery The President also employs budget trickery on spending. He first assumes that Iraq spending will continue indefinitely at 2008 levels (which was never going to happen, according to the military’s own Joint Campaign Plan), and then calculates $1.5 trillion in savings against that baseline. If you eliminate that gimmick, President Obama increases spending by nearly $500 billion over ten years – not even counting the $634 billion health care reserve fund The budget proposes $1.133 trillion in regular discretionary spending in 2010, and claims that is a 7 percent …
NBA owners and players will have to swallow hard if that avid hoops fan, Barack Obama, is elected president and pushes through his tax plan. It’s not just players like Celtics star Kevin Garnett, the league leader in pay, who’d have to figure on paying more in federal income taxes. In fact, the NBA’s 20 highest-paid stars each would lose, on average, an additional $1.2 million to an Obama administration. And plenty of American players could increase their net incomes by signing with overseas franchises. (Obama and running mate Joe Biden might call that “unpatriotic” and “selfish.”) …
It looks more and more like Joe the Plumber was on to something about taxes, though you wouldn’t know if from most of the polls and media. The Heritage Foundation has the details in our new study: If a President McCain got his way on tax reform, Americans could expect to see jobs, the economy and their own disposable income grow much faster than if a President Obama were to push through his proposals. As this chart shows, the economy would grow by $320 billion more in 10 years under …
A recurring theme among critics of the 2001 and 2003 tax cuts is that they didn’t work to strengthen the economy. This argument was on display in an article today in the Washington Times that the data on the 2001-2007 expansion “provides no support for the claim that tax cuts generated exceptional economic growth”. This is a straw man argument. It is at once technically true, and yet a misdirection intended to hide a greater truth. The straw man here is the claim that the tax cuts were enacted to …
