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soulflower

Tax cut deal adds 900 billion to deficit over the next 2 years

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The package will cost about $900 billion over the next two years. The deal comes only days after the deficit commission report, which urged serious action to combat America's long-term debt problem (or crisis).

 

Ironies abound. Democrats spent years railing against George W. Bush for not paying for his tax cuts. Democrats are now emulating the very actions they criticized. Republicans have spent two years preaching about the primacy of deficits. The GOP victory however means a tax deal that will likely prove more costly to the deficit than the stimulus package. This bi-partisan compromise is, oddly, politics as usual.

 

http://www.realclearpolitics.com/articles/2010/12/07/why_obama_caved_on_the_bush_tax_cuts_108166.html

 

Indeed ....

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This is what a Republican dominated House gets you. Until Americans reject the fiction that tax cuts are a magic elixir that defies the laws of deficit reality, this type of disaster will continue. Unfortunately, Americans have been drinking the magic tax cut kool aid for 30 years, even as massive debt has continually piled up. Will Americans recover their senses? That remains to be seen.

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This is what a Republican dominated House gets you. Until Americans reject the fiction that tax cuts are a magic elixir that defies the laws of deficit reality, this type of disaster will continue. Unfortunately, Americans have been drinking the magic tax cut kool aid for 30 years, even as massive debt has continually piled up. Will Americans recover their senses? That remains to be seen.

 

Really?

 

Um, the democrats dominate the House right now.

 

Extending unemployment for 13 more months has nothing to do with this, nor does the reduction in payroll tax, either.

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The main point is that it is not the governments money! When I am short on cash flow. I try a novel concept. I actually spend less! The government really needs to give that a try. Hell, nothing else they have tried has worked.

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If you feel that you are not paying enough in taxes just send the government donations on a regular basis.

 

If you like this deal, don't complain about the 2009 stimulus(1/3 of the stimulus was tax cuts)

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The main point is that it is not the governments money! When I am short on cash flow. I try a novel concept. I actually spend less! The government really needs to give that a try. Hell, nothing else they have tried has worked.

 

It's not your money. The money will be borrowed from China

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Indeed ....

 

Taxes must go up in order to reduce the deficit and everyone needs to feel the pain, right? Where's the spending cuts? Where's the reduction of government bloat? Does that not play a more fundamental role? SPEND LESS!

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Taxes must go up in order to reduce the deficit and everyone needs to feel the pain, right? Where's the spending cuts? Where's the reduction of government bloat? Does that not play a more fundamental role? SPEND LESS!

 

How many billions are still going for federal step increases this year? So much for a pay freeze.

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Taxes must go up in order to reduce the deficit and everyone needs to feel the pain, right? Where's the spending cuts? Where's the reduction of government bloat? Does that not play a more fundamental role? SPEND LESS!

 

Where are we going to find 900 billion in spending to cut over the next 2 years?

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This is what a Republican dominated House gets you. Until Americans reject the fiction that tax cuts are a magic elixir that defies the laws of deficit reality, this type of disaster will continue. Unfortunately, Americans have been drinking the magic tax cut kool aid for 30 years, even as massive debt has continually piled up. Will Americans recover their senses? That remains to be seen.

 

OK, please tell us what the correct and proper tax rate is. Over 100 years of income tax history shows we have had rates from 7% to 92%. Please pick one and explain why your rate is intellectually superior to all the various approaches we have used in the past.

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Where are we going to find 900 billion in spending to cut over the next 2 years?

For starters, the o and republican agreement on reducing SS taxes for employees will amount to $120 billion in just the one year. They should leave the SS fund alone and instead raise income taxes on the very wealthy but a little, cut some spending and make some minor adjustments in program costs and the deficit will shrink and over time, perhaps even get to a healthy level where the economy can handle it, maybe even perhaps in some years, eliminate the deficit as all adjusts. The clowns in office have no concept of strengthening financial management all they know how to do is spend, then talk and then enact further damaging authority to the inept.

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With the Deep Depression we are in we need to make people "feel good".This legislation makes people" feel good".

Really? Feel good? Sounds like the young unmarried girl that has sex because it "feels good" and then when saddled with babies creates long term liabilities and perhaps not so feel goods the rest of her life with society getting to pay for her mistakes. So this legislation makes people feel good about getting minimal immediate gratification while placing a huge financial burden on themselves and the country now and in the future. ha ha ha That is a good one. I feel good at reading your humor on this. You were joking, right?

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This is what a Republican dominated House gets you. Until Americans reject the fiction that tax cuts are a magic elixir that defies the laws of deficit reality, this type of disaster will continue. Unfortunately, Americans have been drinking the magic tax cut kool aid for 30 years, even as massive debt has continually piled up. Will Americans recover their senses? That remains to be seen.

Until Congress rejects the fiction that they can keep increasing spending to buy votes, and then raise taxes at will to pay for their fiscal insanity, we will never get the deficit under control. And, since when is UE compensation a Federal issue?

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Some posters have a problem with that concept.

:D Yep, they sure do. Too many think they have a right to the fruits of the workers. The government saps all significant individual discretion. Just look at the long list of local, state and federal taxes we pay. The % is enormous when all taxes including hidden taxes are added up and your income is redistributed to causes that waste.

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Sure is but the deficit spending is borrowed from China...

And that's Congress' fault. Confiscate every penny of every asset from every Congressman for the last 60 years. That would be a start to lessening the deficit. It would also send a message to all current and future Congressmen that they will be held accountable, and that it will hurt them when they are stupid.

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If you like this deal, don't complain about the 2009 stimulus(1/3 of the stimulus was tax cuts)

 

The so-called tax cuts were not things to build a business on. They were just a one-time break mostly for people who don't pay much taxes, or encouragement to dig your personal financial hole a little deeper with tax breaks for buying cars and houses, or buying solar water heaters and plug in electric cars, the kind of things very few people would do with their own money because it is so darned expensive.

 

Nothing would stimulate the economy more than fixed low tax rates you have confidence aren't going to be changing every few years. You need to be able to see 5-10 years out knowing what your expenses are going to be before you commit to expanding facilities and workforce. That and not having half the politicians in the country constantly railing about the rich and their obscene profits and promising to do something about it.

 

If you want to borrow a lesson from China, drop the class warfare and adopt their motto of, "It is glorious to become rich."

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Where are we going to find 900 billion in spending to cut over the next 2 years?

 

Foreign aid and welfare for illegal aliens would be a fine place to start.

Military cuts could be made by bringing home some troops and cleaninng up wasteful spending.

 

Same could be said for NASA.

Government spendiing on security etc for trips to foreign nations to have meetings that could be held via video/phone.

Killing the war on drugs.

 

There are so many areas the government throws money around like it grows on trees that could be squashed or cleaned up it's ridiculous.

 

When every penny counts, every penny counts.

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Really? Feel good? Sounds like the young unmarried girl that has sex because it "feels good" and then when saddled with babies creates long term liabilities and perhaps not so feel goods the rest of her life with society getting to pay for her mistakes. So this legislation makes people feel good about getting minimal immediate gratification while placing a huge financial burden on themselves and the country now and in the future. ha ha ha That is a good one. I feel good at reading your humor on this. You were joking, right?

 

When employers" feel good" they create jobs.If they" don't feel good" they don't create jobs.

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Where are we going to find 900 billion in spending to cut over the next 2 years?

 

I would put more stock in these estimates if they included a little realistic analysis. I suspect that this estimate is based on, "if everything remains the same, and no one changes behavior" this is the lost revenue. If they could also tell me what the estimated additional economic growth would be, and the mitigating increase in revenue would be, that would be a start. For example, how many people are going to work an extra year, or an extra few hours a week because of lower tax rates, leading to some increase in tax revenue? How many people are going to not worry quite as much about squeezing through every tax loophole and shelter they can find, and offset some of their tax savings with a more relaxed approach to tax preparation? How many people are going to project out their finances and decide that now that they are reaping a net 4-5% increased income that it now makes sense to expand the business, or upgrade the home or facilities? Tax rates matter. No matter how small an increase or decrease, there are going to be businesses that see the balance sheet go from red to black and vice versa, or see a threshold for expanding/contracting or closing completely, crossed.

 

There is a feedback loop that causes tax rate decreases, to not reduce the revenue as much as you would expect, and tax rate increases not to increase revenues as much as you would expect. Remember the planners in New York who thought they could increase funding for healthcare by a tax increase on cigarettes? They found revenue went down. So show me the numbers.

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