Obama's Stimulus: George Bush On Steroids
Cato Institute's Dan Mitchell explains why Obama's so-called stimulus is good for the government, but bad for the economy:
CARPE DIEM
Professor Mark J. Perry's Blog for Economics and Finance
Monday, January 26, 2009
About Me
- Name: Mark J. Perry
- Location: Washington, D.C., United States
Dr. Mark J. Perry is a professor of economics and finance in the School of Management at the Flint campus of the University of Michigan. Perry holds two graduate degrees in economics (M.A. and Ph.D.) from George Mason University near Washington, D.C. In addition, he holds an MBA degree in finance from the Curtis L. Carlson School of Management at the University of Minnesota. In addition to a faculty appointment at the University of Michigan-Flint, Perry is also a visiting scholar at The American Enterprise Institute in Washington, D.C.
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17 Comments:
I know evolving from the trickle down theory to the trickle up is scary but, the top 1%, the job creators need to get weaned off their Government welfare. Flood the middle class with money and it will trickle up just wait thirty years and see if it works. LOL
The top 1 percent pay nearly 40 percent of all federal income taxes. When they receive in excess of 40 percent of all federal distributions you can chime in with the "government welfare" nonsense. Until then, they just prefer you said "thank you".
Ya Kind of like so many Government tax breaks that Buffett cited himself, the third-richest person in the world, as an example. Last year, Buffett said, he was taxed at 17.7 percent on his taxable income of more than $46 million. His receptionist was taxed at about 30 percent. He did that without using any write off or tax loop holes.
Sure, but Mr. Buffett payed millions in taxes. How much did his receptionist pay?
I wish I was only taxed at 30%! :)
I don't think anybody should be complaining about 17.7% - I just wish we were ALL paying that much.
If wishes were horses... we'd most likely be eating horseburgers...
Buffet earned millions though just like I earned thousands. Why doesn't he pay the same rate as a middle class person?
17.7% of a large income is a large amount of tax. It's probably misleading - a person with high income who 'works' vs someone who 'invests' will be subjected to higher tax rates (instead of capital gains etc).
A substantial minority of the population pays no income tax (43 million returns pay no fed income tax vs 136 million total returns).
The 17.7% is an average (that includes low capital gain tax rates). High earners that don't depend on investment income are still subject to the top marginal rate (and hence their tax rate is higher than 17.7%).
I would also note that the earned income tax credit allows many of the nonpayers to actually have a negative tax rate (since the government gives them money).
Hedge fund investors pay 15%. How many good paying jobs do you think they created. What do you think Geithner's tax rate was before he got caught cheating?
With regard to all the discussion here about who does and does pay federal taxes it should be clear we are fast arriving at a point where a minority pays all the federal taxes. In other words a minority of voters pay for the country while a majority takes from the country. We use to call them parasites.
The democrats have longed for that day since that solidifies their voting majority which is composed of people who either do not work, do not pay taxes, receive welfare or all of the above.
I am sure Speaker Pelosi is counting on achieving that objective very soon. It is her considered opinion, from a weekend interview, we need to fund birth control as part of the stimulus since it will help the states better manage their budgets.
Why does the word total idiot and demagogue, as it relates to her and her fellow travelers, come to mind.
Hey T Jefferson,
You left out the fact that Buffet gets a lot of his income from capital gains which are double taxed (corporate and individual).
Go look at the IRS statistics for average tax rates vs income. The Buffet example is a canard and Buffet can always make a large donation to the US Treasury if he's that embarassed.
13. Although the House Democrats’ proposal has been billed as a transportation and infrastructure investment package, in actuality only $30 billion of the bill – or three percent – is for road and highway spending. A recent study from the nonpartisan Congressional Budget Office found that only 25 percent of infrastructure dollars can be spent in the first year, making the one year total less than $7 billion.
14. Much of the funding within the House Democrats’ proposal will go to programs that already have large, unexpended balances. For example, the bill provides $1 billion for Community Development Block Grants (CDBG) – a program that already has $16 billion on hand. States also are sitting on some $9 billion in unused highway funds – funds that Congress is prepared to rescind later this year.
15. All board members of the “Accountability and Transparency Board” created by this legislation are appointees of the President; none will be appointed by Congress.
16. A scant 2.7 percent, or $22.3 billion of the overall package, is dedicated to small business tax relief.
17. The Joint Committee on Taxation estimates that the legislation increases by seven million the number of people who get a check back from the IRS that exceeds what they paid in payroll and income taxes.
18. The “Making Work Pay” tax credit at the center of the plan amounts to $1.37 a day, or about the price of a cup of coffee.
19. Almost one-third of the so-called “tax relief” in the House Democrats’ bill is spending in disguise, meaning that true tax relief makes up only 24 percent of the total package – not the 40 percent that President Obama had requested.
20. $825 billion is just the beginning – many Capitol Hill Democrats want to spend even more taxpayer dollars on their “stimulus” plan. In fact, the Chairman of the House Appropriations Committee, Rep. David Obey (D-WI), told Roll Call earlier this month, “I would not be surprised to see us go further on some of these programs down the line.”
Is it just me, or does something smell like Jimmy Carter?
Kill this pig!
Ralph Short said
The democrats have longed for that day since that solidifies their voting majority which is composed of people who either do not work, do not pay taxes, receive welfare or all of the above.
That paragraph you wrote is loaded with code words. I take it that you mean all Democrates are dead beats. I voted For the Dems in November. I have had a good paying job for over thirty years I pay 28%in taxes, and a long time ago in the seventies I had to go on welfare. Thank god it was there as a safety net at the time. Nice try on the rhetoric and get used to the changes.
t jefferson, it seems to me you are the one using code words and rhetoric. I do note you have not challenged or attempted to justify the fact that less and less a percentage of the people are paying taxes. Nor have you responded to my comments on Pelosi's theories on why birth control should be part of a stimulus. Maybe she meant "stimulus" in a different context, who knows.
The fact that you pay taxes and vote democrat only proves the wisdom of P.T. Barnum.
Buffet pays a lower rate because most of his income is capital gains. But in reality he pays way more then 17%, for two reasons.
1. capital gains taxes are not inflation adjusted. So if you hold a security for 5 years (like he does) you get taxes on nominal gains, not real ones. The average inflation adjusted capital gains tax is abou8t 30 percent.
2. He is paying some of the corporate tax. Before the value of a security can go up of a company, its profits must increase. But corporate taxes reduce the profit of a firm and therefore reduce the underlying value of the security.
In reality, Buffett is paying way more they 17%. Hes probably paying more like 35 to 40%. 17% is just what he has to write a check on, not the inflation and the embedded taxes.
The definition of an idiot is one who repeats the same actions over and over again, expecting different results each time.
t jefferson
Your comments are typical of a democrat. You extrapolate "I" to the entire population. Fortunately public policy is (or should be) concerned with the "We's" rather than the "I's".
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