Bad news for Dems

mulp · #21 (**permalink**) 05-09-2008, 07:50 PM

Quote:

Originally Posted by cat's meow

Right or wrong, what Reagan stood for as the Gov or CA was not close to what is going on today.

But a lot of Republicans make the same claims as the Reaganite did two decades ago, that they are working to reduce the size of government, to get it off the people's backs, and that Democrats are much bigger spenders and more fiscally irresponsible.

I ran across an analysis on mises.org by its founder and the American icon of "Austrian economics" which really isn't Austrian, but in any case.
The Myths of Reaganomics - Murray N. Rothbard - Mises Institute

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The Myths of Reaganomics

Daily Article | Posted on 6/9/2004 by Murray N. Rothbard

This memo to Mises Institute members was written in late 1987, and published in "The Free Market Reader," LH Rockwell, Jr., ed., 1988, pp. 3342–362 and is posted on Mises.org in an edited edition.

I come to bury Reaganomics, not to praise it.

How well has Reaganomics achieved its own goals? Perhaps the best way of discovering those goals is to recall the heady days of Ronald Reagan's first campaign for the presidency, especially before his triumph at the Republican National Convention in 1980. In general terms, Reagan pledged to return, or advance, to a free market and to "get government off our backs."

Specifically, Reagan called for a massive cut in government spending, an even more drastic cut in taxation (particularly the income tax), a balanced budget by 1984 (that wild-spender, Jimmy Carter you see, had raised the budget deficit to $74 billion a year, and this had to be eliminated), and a return to the gold standard, where money is supplied by the market rather than by government. In addition to a call for free markets domestically, Reagan affirmed his deep commitment to freedom of international trade. Not only did the upper echelons of the administration sport Adam Smith ties, in honor of that moderate free-trader, but Reagan himself affirmed the depth of the influence upon him of the mid-19th century laissez-faire economist, Frederic Bastiat, whose devastating and satiric attacks on protectionism have been anthologized in economics readings ever since.
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Government Spending. How well did Reagan succeed in cutting government spending, surely a critical ingredient in any plan to reduce the role of government in everyone's life? In 1980, the last year of free-spending Jimmy Carter the federal government spent $591 billion. In 1986, the last recorded year of the Reagan administration, the federal government spent $990 billion, an increase of 68%. Whatever this is, it is emphatically not reducing government expenditures.
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Deficits. The next, and admittedly the most embarrassing, failure of Reaganomic goals is the deficit. Jimmy Carter habitually ran deficits of $40-50 billion and, by the end, up to $74 billion; but by 1984, when Reagan had promised to achieve a balanced budget, the deficit had settled down comfortably to about $200 billion, a level that seems to be permanent, despite desperate attempts to cook the figures in one-shot reductions.

This is by far the largest budget deficit in American history. It is true that the $50 billion deficits in World War II were a much higher percentage of the GNP; but the point is that that was a temporary, one-shot situation, the product of war finance. But the war was over in a few years; and the current federal deficits now seem to be a recent, but still permanent part of the American heritage.
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Tax Cuts. One of the few areas where Reaganomists claim success without embarrassment is taxation. Didn't the Reagan administration, after all, slash income taxes in 1981, and provide both tax cuts and "fairness" in its highly touted tax reform law of 1986? Hasn't Ronald Reagan, in the teeth of opposition, heroically held the line against all tax increases?

The answer, unfortunately, is no. In the first place, the famous "tax cut" of 1981 did not cut taxes at all. It's true that tax rates for higher-income brackets were cut; but for the average person, taxes rose, rather than declined. The reason is that, on the whole, the cut in income tax rates was more than offset by two forms of tax increase. One was "bracket creep," a term for inflation quietly but effectively raising one into higher tax brackets, so that you pay more and proportionately higher taxes even though the tax rate schedule has officially remained the same. The second source of higher taxes was Social Security taxation, which kept increasing, and which helped taxes go up overall. Not only that, but soon thereafter; when the Social Security System was generally perceived as on the brink of bankruptcy, President Reagan brought in Alan Greenspan, a leading Reaganomist and now Chairman of the Federal Reserve, to save Social Security as head of a bipartisan commission. The "saving," of course, meant still higher Social Security taxes then and forevermore.

Since the tax cut of 1981 that was not really a cut, furthermore, taxes have gone up every single year since, with the approval of the Reagan administration. But to save the president's rhetorical sensibilities, they weren't called tax increases. Instead, ingenious labels were attached to them; raising of "fees," "plugging loopholes" (and surely everyone wants loopholes plugged), "tightening IRS enforcement," and even revenue enhancements." I am sure that all good Reaganomists slept soundly at night knowing that even though government revenue was being "enhanced," the president had held the line against tax increases.
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Deregulation. Another crucial aspect of freeing the market and getting government off our backs is deregulation, and the administration and its Reaganomists have been very proud of its deregulation record. However, a look at the record reveals a very different picture. In the first place, the most conspicuous examples of deregulation; the ending of oil and gasoline price controls and rationing, the deregulation of trucks and airlines, were all launched by the Carter administration, and completed just in time for the Reagan administration to claim the credit. Meanwhile, there were other promised deregulations that never took place; for example, abolition of natural gas controls and of the Department of Energy.

Overall, in fact, there has probably been not deregulation, but an increase in regulation. Thus, Christopher De Muth, head of the American Enterprise Institute and a former top official of Reagan's Office of Management and the Budget, concludes that "the President has not mounted a broad offensive against regulation. There hasn't been much total change since 1981. There has been more balanced administration of regulatory agencies than we had become used to in the 1970s, but many regulatory rules have been strengthened."
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On monetary and fiscal policy, the Democrats are the classic party of liberal Keynesianism, in contrast to the Republican policy of conservative Keynesianism. The problem is that, in the last decade or two, it has become increasingly difficult to tell the difference. Apart from supply-sider Kemp, we can expect the president of either party to be a middle-of-the-road liberal/conservative Keynesian. And so we can expect the next administration's economic policies to be roughly the same as they are now. Except that the rhetoric will be different. So we can, therefore, expect diverse perceptions and responses to a similar reality by the public and by the market. Thus, if Jack Kemp becomes president, the public will wrongly consider him a champion of hard money, budget cutting, and the free market. The public will therefore underestimate the wildly inflationist reality of a Kemp administration. On the other hand, the public probably perceives the Democrats to be wilder spenders relative to the Republicans than they really are. So should the Democrats win in 1988, we can expect the market to overestimate the inflationary measure of a Democratic administration.

All of this, along with the universal misperception of Reaganomics, illustrates once more the wisdom of those incisive political philosophers, Gilbert and Sullivan: "Things are not always what they seem; skim milk masquerades as cream."

mulp · #22 (**permalink**) 05-09-2008, 07:58 PM

My previous post exerps from a mises.org article witten in the seven year of the Reagan administration. Here is the parallel article on Bush economic policies.
Bush has NOT cut taxes - Mark Brandly - Mises Institute

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Bush has NOT cut taxes

Daily Article | Posted on 4/30/2007 by Mark Brandly
While the occupation of Iraq is the major topic of debate in the 2008 presidential race, the candidates have also taken positions on George Bush's fiscal policies. We see Republican candidates supporting Bush's tax "cuts" and being asked to sign a pledge, a pledge they will all, except for Ron Paul, violate, promising not to raise taxes, while Democrats decry Bush's tax "cuts" and promise to at least consider rolling back the tax cuts should one of them take power.
In short, there is general agreement that Bush, and the Republican Party in general, is in favor of tax cuts. Let's consider the validity of this assumption. Do Bush's policies demonstrate that he's in favor of reducing taxes?

First, in order to consider how Bush's policies have affected tax burdens, I need to define the term "taxes." Taxes are a revenue source for the state and the state is the entity that has a monopoly, or at least claims the right to a monopoly, over the use of coercion within its political borders. Therefore, Hans Hoppe's explanation of taxation as "a coercive, non-contractual transfer of definite physical assets" (Economics and Ethics of Private Property, p. 28) provides us with a sound definition of taxation. Taxes are the takings of private property in order to fund the state. They are a form of aggression against private property.

We normally think of taxes as coercive non-contractual transfers that are based on the sale price of some exchange, such as excise taxes on the sale of goods or services, tariffs on imports, or income taxes on the sale of labor. Our federal government's largest revenue sources are due to taxing workers for showing up to work and earning incomes. In 2006, the federal government collected $1,044 billion and $838 billion, respectively, in income taxes and payroll taxes, which are a form of income taxes.

In addition to what we normally think of as taxes, the state also has the option of borrowing money by selling government securities in order to finance its spending. This is a significant form of finance as the federal debt, including intragovernmental debt, increased $574 billion in fiscal year 2006. Budget deficits are generally not considered to be a form of taxation and it's oftentimes useful to distinguish between revenues generated by taxing the sale of a good or service and revenues generated by selling securities. However, government debt is a coercive transfer of property from private hands to government coffers.

Those who lend the government money are purchasing a promise to take someone's property in the future in order to repay the loan. If the securities that are issued are to be repaid, then the state is simply shifting tax burdens away from current taxpayers on to future taxpayers. We should recognize that there is a current burden from government borrowing and that is the opportunity cost of the resources the state commands due to the revenues resulting from the sale of securities. However, we must also recognize that government securities are simply promises to take someone's property in the future and give it to the bondholder. This future aggression against private property is a tax. Deficit spending is simply another way of shifting tax burdens.

What about the case where the state incurs debt but later repudiates that debt? Suppose that the state borrows $100 from me with the promise to take $100 plus interest from someone in the future and use those funds to repay the debt. However, when the time comes, the state refuses to tax the future taxpayer and declares that the debt is repudiated. In this case, the state has taken $100 of my property as assuredly as if it had taken $100 from me in direct taxes. In fact, debt repudiation is another coercive non-contractual transfer of assets, in other words, it's a method of taxation.
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Since all forms of government revenue are generated by a coercive, non-contractual transfer of assets, it would be accurate to refer to all government spending as some form of taxation. Now, what can we say about Bush's tax-cutting reputation? Simply put, it's undeserved. $28
Taxes are a form of aggression against private property.

Including the estimates for the 2007 budget, in the first six years of Bush's term in office, federal income tax revenues have increased 18% and payroll tax revenues have increased 26%, the money supply, defined as M3, increased 41% in just the first five years since Bush took office, and the federal debt has increased 52%, and is approaching $9 trillion, since the beginning of fiscal year 2002.

The most appropriate measure of the level of taxation is government spending. In seven years, from fiscal year 2001 to the proposed budget in fiscal year 2008, federal spending will increase from $1,863.2 billion to an estimated $2,901.9 billion, an increase of 55%. Actual spending in 2008 will probably top $3 trillion, so it's likely that federal spending will increase more than 60% in the first seven years of Bush's reign. The president has supported these spending increases and is pushing for even higher levels of spending.

Bush should not be credited with cutting our tax burdens. He has engaged in tax shifting and in hiding the burdens of his expansions of the welfare and warfare state, and he has demonstrated that he's opposed to lowering our tax burdens. Deep into his second term, we have plenty of evidence to show that Bush should be blamed for increasing our tax burdens at a phenomenal pace.

The Republican Party claims to be the party of limited government and economic freedom. Don't believe it. Republicans have shown that when they are in power they are even more fiscally irresponsible than their Democratic counterparts, and that takes some doing.

Petey · #23 (**permalink**) 05-09-2008, 09:00 PM

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Originally Posted by wow

Democrats are in a recession, the rest of America is doing great.

I'm warning you!

Super Patriot · #24 (**permalink**) 05-10-2008, 08:51 AM

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Originally Posted by George O Well

>>>Utter nonsense. Western Europe, Australia, Canada and even China are all doing fine. And they have been for quite some time now. But if you insist on legislating billionaires, I'm going to insist on taxing 'em.

Sure, all those socialist countries are doing great...except for the fact that they have been forced to surrender individual liberty in the name of a bullshit collectivist dream (or nightmare to those who love freedom).

wow · #25 (**permalink**) 05-10-2008, 09:47 AM

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Originally Posted by Super Patriot

Sure, all those socialist countries are doing great...except for the fact that they have been forced to surrender individual liberty in the name of a bullshit collectivist dream (or nightmare to those who love freedom).

Not to mention, the American people are buying Trillion$$$ worth of their exports.
All foreign exports should be banned, these Socialists will go broke.

mulp · #26 (**permalink**) 05-10-2008, 12:10 PM

Quote:

Originally Posted by Super Patriot

Sure, all those socialist countries are doing great...except for the fact that they have been forced to surrender individual liberty in the name of a bullshit collectivist dream (or nightmare to those who love freedom).

Yeah, those French and German and Chinese soldiers who have been stop-lossed and shipped to Iraq is an outrage of government enslavement. Totally unlike the US where patriots are signing up in such large numbers that the US military is turning them away just like they were forced to do in WWII, and cutting the pay and benefits, especially the benefits like GI Bill because the US military needs to discourage people from signing up.

Super Patriot · #27 (**permalink**) 05-10-2008, 01:27 PM

I know, isn't America just awful? I'll check back with you if a Democrat wins the Presidency in November (God forbid) to see how rosy things have become, according to you & other libs.

Suburbanite · #28 (**permalink**) 05-11-2008, 04:54 AM

wow how are you the most consistent moron on this forum? how fucking pathetic? do you get economics? Are you just paid for by the CIA to lie to America via internet. Fat Ops

Suburbanite · #29 (**permalink**) 05-11-2008, 04:58 AM

Quote:

Originally Posted by wow

Not to mention, the American people are buying Trillion$$$ worth of their exports.
All foreign exports should be banned, these Socialists will go broke.

you dont need to ban them, in fact the global economy is crucial to sustaining out large population. You just need to set the correct import taxes on countries so that even if it only costs 5cents for a Chinese person to make a toy, by the time its imported here it costs $19.99 like everything else. Then, garner incentive to participate equally in the world economy by lowering import taxes in exchange for countries meeting international minimum wage and employment laws.

mulp · #30 (**permalink**) 05-11-2008, 05:47 PM

Quote:

Originally Posted by Super Patriot

I know, isn't America just awful? I'll check back with you if a Democrat wins the Presidency in November (God forbid) to see how rosy things have become, according to you & other libs.

Just out of curiousity, were you one of the many conservatives who posted millions of messages in the first five years of Bush saying in effect "we won, you lost, conservatives are in control, and liberals are out of power forever"?

Of course, the companion messages were along the lines of "we conservatives have been kept down by the jack boot of liberals who have forced our faces down into the mud, and we aren't going to take it any more." And that remains a constant.