The True Price Of The Theft Act

Aye thinks that I’m hypocritical for not giving the government a rebate on my tax cuts, if I’m opposed to them.

I’m neither “whining” nor “crying” about the massive Bush generational theft — dwarfing that of the Obama stimulus. I’m simply calling attention to it. Read my comment # 8, above. Not a tear to be seen.

Warren Buffet was very much opposed to the Bush economic stimulus (i.e. borrowing massive amounts of money to finance tax cuts), yet Buffet famously employs teams of lawyers to take advantage of every line in the tax code to which he’s legally entitled. Buffet famously said, also, that he pays 20% of his income as tax, where his secretary pays 30%. Buffet is not a “hypocrite,” either. He’s a businessman.

So am I. A businessman.

I am very much into promoting good legislation. I am very much not into ultimately meaningless gestures. I am a voter, not a crusader.

– Larry Weisenthal/Huntington Beach, CA

Unfit, those cats would take care of you seeing as how they are
much smarter.

Larry, you are a hypocrite and not a business man. Your attempt to
compare apples to oranges doesn’t fly, but you know that.
If you don’t think the tax cuts were ok, then send it back. Or
you could pay more taxes to make up for the cut. Your desperate
attempts to blame Bush while absolving your “God” are disgusting.

Hard, you are a hard guy to like. I mean, truly. Have you ever heard of the concept of the honest difference of opinion? Does it make you feel so much better as a person to diminish those with whom you disagree? I’ll leave it to others to determine if my comments (with whom most on this blog would disagree) or yours (politically more in tune with most of the other folks) are the more “disgusting.”

– LW/HB

Let me see if I understand this. Letting people keep MORE of the money that THEY EARN for a ten year period = generational theft. Is that what you are saying?

Yes, precisely so. It is called pass the bill down to your children as opposed to pay as you go.

Had Bush cut spending and then cut taxes by a similar amount, he’d have been a hero. But, instead, he took the easy way out. He increased spending and cut taxes at the same time. He then told us to use the extra money and go out and shop. He literally said this. Perhaps putting it in these terms will help you to understand what is really going on. He cuts our taxes. Makes up for the budget shortfall by borrowing money from the People’s Republic of China. So, in actuality, we are borrowing money from the People’s Republic of China to allow us to have more money for our shopping spree. Only, unlike our personal VISA cards, the bill to the People’s Republic of China won’t be repaid within the working lifetimes of most of us. It will be paid by our children and grandchildren, who will have to pay higher taxes tomorrow, to spare us the unpleasantness of having to pay higher taxes today.

Generational theft.

– Larry Weisenthal/Huntington Beach, CA

The one historical point you are missing, Larry, is that the the three times in the past that taxes were significantly lowered, it has led to higher gross receipts by the U.S. Treasury,

Wisdom, this is what conservatives (not conservative economists, but conservative pundits) always say. But this is extraordinarily misleading. With both Reagan and Bush, when there was a “significant lowering” of the tax rates, there was no compensatory reduction in government spending. Instead, what you had was a massive infusion of borrowed capital — the government put money back into the people’s pockets, while replacing the money they would have otherwise received from the people with money borrowed from China and elsewhere. This resulted in more capital in the economy. Of course, the economy grew — the same way that my personal economy grew when I took out a home equity line of credit, several years ago.

Here is what is important, however. The increased taxes generated by having more money in the economy by virtue of the tax cuts eventually paid for less than 30% of the money which had to be borrowed to offset the revenue lost from the tax cuts. Even conservative economists agree with this. Even Laffer, I think, now believes this. Even the Heritage Foundation which “Aye” cited states that tax cuts don’t pay for themselves, although the Heritage Foundation is disingenuous in the way they minimize this issue, using intentionally misleading language.

The most important reason tax receipts have gone up, following tax cuts, by the way, is very simple. At the time of the Bush tax cuts and, before that, the Reagan tax cuts, the country was in a recession. Following recovery from recessions – recoveries which historically always happen – whether in the 90% marginal tax era of Eisenhower or in the low marginal tax era of more modern times — the GDP goes up and accordingly tax receipts increase.

But, once again, the tax cuts never come close to paying for themselves. And it is a misnomer even to call them tax cuts. They are more accurately referred to as tax shifts, as what finances the tax cuts is borrowed money, which must be paid back, with interest, by tomorrow’s taxpayers.

It can be called taxation without representation (as the people who will be on the hook for the tax are currently not of voting age) or it can be called generational theft.

But here’s the point: add up the generational theft from the Bush tax cuts plus the unfunded Iraq War (also paid for with borrowed money) plus the $700 billion Wall Street bail out, and you are looking at well over 5 to 6 trillion dollars. This dwarfs the debt incurred by the current $780 billion “stimulus,” which is 36% tax cuts, which, presumably, you like.

– Larry Weisenthal/Huntington Beach, CA