Budget Deficit Shrinking Unexpectedly Quickly

[Arnfinn Madsen]

just wanted to point out that higher tax leads to higher revenue.
**********************************************
This does not prove anything. A true test of studying tax rates vs. tax receipts would for Germany to lower their taxes, say 10%, and then we look at THEIR tax receipts for the next 5 years...then we could objectivly evaluate the effect of tax rates and tax receipts. Germany's GDP gowth has been terrible. Schoeder is in huge political trouble for the German economy.

[/ QUOTE ]

You are mixing the issues, Felix. Their GDP pr capita 27% lower than US, way too large to be explained by tax level or unemployment difference. It comes down to lower productivity. There are many factors in government policy that effects productivity more than tax level.

[ptmusic]

[ QUOTE ]
[ QUOTE ]
[ QUOTE ]
Also there is the question of morality/ethics of the government taking money by force (taxes) from it's citizens. Most agree taxes are necessary, but should a govt's role be to maximize it's tax coffers or foster a freer society that allows people to keep more of THEIR income? I would prefer to err on the latter because big govt lead to less freedom.

[/ QUOTE ]

If you are concerned about a loss of freedom, then surely you are against the Patriot Act? Or are you concerned about a loss of freedom only when it fits with the Bush package?

-ptmusic

[/ QUOTE ]

Couldn't one turn around ask you if you are concerned about the loss of freedom from the Patriot act than surely you are for the Bush tax cuts. Or are you concerned about a loss of freedom only when it fits with the Democratic talking points?

Also to actually be fair, the Patriot Act while troubling has not actually prevented me from doing something that I was doing before its enactment. and this is true for almost everyone. On the other hand, every dollar of tax that is taken from me is one less dollar that I would have made sometype of choice with.

so if it is only an arguement about which infringes freedom more. taxes win easily.

[/ QUOTE ]

I am for tax cuts. Not the way Bush has done it, and not when we have a record high deficit and two wars going on, but generally speaking, I agree with Republicans and conservatives on taxes and smaller federal government.

I'm also against the Patriot Act, so there is no blindly following contradictory party propaganda on these two issues by me. I was simply pointing out a contradiction in "raise taxes = less freedom" vs. the Patriot Act.

-ptmusic

[Felix_Nietsche]

I was simply pointing out a contradiction in "raise taxes = less freedom" vs. the Patriot Act.
*******************************************
You are reading a newspaper with binoculars.
There is a correlation between the size of govt and the amount of freedom people have. The Patriot act when compared with the amount of restrictive laws on the books is just a minnow to a whale.

[adios]

[ QUOTE ]
I am for tax cuts. Not the way Bush has done it, and not when we have a record high deficit

[/ QUOTE ]

Bzzzzzzt wrong. Another victem of political spin doctoring [img]/images/graemlins/smile.gif[/img]. The U.S. is not running a record high deficit. This ground has been covered many times before on this forum. The deficit in absolute terms is higer than say it was in 1990. However, the economy has grown a lot since then. The way that people compare budget deficits historically is to do as a percentage of GDP and the budget deficits as a percentage of GDP are not anywhere close to record levels. Also there was this nasty thing called a recession that started in late 2000 or early 2001 (take your pick). Look at the budget data and you'll see a precipitous decline in tax revenues the correlate to the recession. This is easy to understand since rising unemployment means lower tax revenues. The magnitude of the tax cuts of 2003 would not remove the budger deficit either. I would urge you to actually look at the budget data and make your own conclusions. I've posted links to the data many times. Start at www.cbo.gov and go from there.

[ptmusic]

[ QUOTE ]
I was simply pointing out a contradiction in "raise taxes = less freedom" vs. the Patriot Act.
*******************************************
You are reading a newspaper with binoculars.
There is a correlation between the size of govt and the amount of freedom people have. The Patriot act when compared with the amount of restrictive laws on the books is just a minnow to a whale.

[/ QUOTE ]

Ok... so you're against the minnow, right?

-ptmusic

[ptmusic]

I didn't say "record high deficit" as a percentage of GDP, did I? I hope you got your thrills pushing your buzzer, though.

What's your point? I'll repeat mine: I am for tax cuts, but not the way Bush did it, and not at the time he did it. Even if it wasn't a record deficit by any definition (absolute or otherwise), I still would be: for tax cuts, but not the way Bush did it. And the fact that the magnitude of the tax cuts wouldn't account for the whole deficit (I THINK that's what you were trying to say) is beside the point: I still think he made a mistake adding to the deficit the way he (and obviously congress) did.

-ptmusic

[Felix_Nietsche]

If you want to design a true SCIENTIFIC experiment on the effects of tax rates versus tax revenues for GERMANY then you would need to do as I descibe in the previous post.

Obviously there are other factors that effect tax receipts. Punitive business laws can aslo hurt businesses which aslo hurts the amount that a company can pay their employees.

[lastchance]

Actually, that sample size would be far too insignifigant. You suggest running it on a 5 year basis one time? This would be very, very subject to other independent factors outside of your control. Also, considering over time, economy grows in general, tax revenues will increase because of that anyway, and so you have to adjust for that.

Certainly BZ_Zorro is right, that F(tax rate) is a graph dependent on many other factors. We cannot possibly begin to imagine what these factors are, and what exact effect they have on tax revenue.

[MMMMMM]

[ QUOTE ]
[ QUOTE ]
Yes, there are people who "tend to view economics as a purely zero-sum game." Some of them frequent this board. Where have you been?

[/ QUOTE ]

Name some.

[/ QUOTE ]

My impression is that Superleeds and OnceAndFutureKing mostly tend to view economics as a zero-sum game. There may be others.