Obama calls for increase in Federal Gas Tax

[BigRob]

OK, so now you're saying that a smaller percent of a larger GDP is better (or at least as good as ) a larger percentage of a smaller GDP. You may actually have a point, there.

I have always said this...and always said that the way to increase revenues needs to come by expanding GDP, not simply increasing rates.

Further, a smaller tax could actually result in a larger GDP. So, raising taxes above a certain level is likely to be counter productive.

Yes, I agree, it seems that despite the tax rates however, revenues as a percentage of GDP remain in roughly the same area.

How do we know what that level is?

I don't know. I think the real debate should be about policies that can be shown to increase the GDP.

 

[PLC1]

I have always said this...and always said that the way to increase revenues needs to come by expanding GDP, not simply increasing rates.



Yes, I agree, it seems that despite the tax rates however, revenues as a percentage of GDP remain in roughly the same area.



I don't know. I think the real debate should be about policies that can be shown to increase the GDP.

That's the bottom line. Increase the GDP, which means getting people back to work, more manufacturing in the US instead of importing everything, that's how we attack the economic situation, a larger market for business, which in turn will hire more workers.



Sounds easy. Now, how do we go about that?

 

[BigRob]

That's the bottom line. Increase the GDP, which means getting people back to work, more manufacturing in the US instead of importing everything, that's how we attack the economic situation, a larger market for business, which in turn will hire more workers.

Sounds easy. Now, how do we go about that?

From the Heritage Foundation:
"This does not mean tax policy cannot affect economic growth. The right tax cuts can add substantially to the economy's supply side of productive resources: capital and labor. Economic growth requires that businesses efficiently produce increasing amounts of goods and services, and increased production requires consistent business investment and a motivated, productive workforce. Yet high marginal tax rates—defined as the tax on the next dollar earned—serve as a disincentive to engage in such activities. Reducing marginal tax rates on businesses and workers increases the return on working, saving, and investing, thereby creating more business investment and a more productive workforce, both of which add to the economy's long-term capacity for growth.

Yet some propose demand-side tax cuts to "put money in people's pockets" and "get people to spend money." The 2001 tax rebates serve as an example: Washington borrowed billions from investors and then mailed that money to families in the form of $600 checks. Predictably, this simple transfer of existing wealth caused a temporary increase in consumer spending and a corresponding decrease in investment but led to no new economic growth. No new wealth was created because the tax rebate was unrelated to productive behavior. No one had to work, save, or invest more to receive a rebate. Simply redistributing existing wealth does not create new wealth.

In contrast, marginal tax rates were reduced throughout the 1920s, 1960s, and 1980s. In all three decades, investment increased, and higher economic growth followed. Real GDP increased by 59 percent from 1921 to 1929, by 42 percent from 1961 to 1968, and by 31 percent from 1982 to 1989."


Also:
"Since revenues move with GDP, the common-sense way to increase tax revenues is to expand the GDP. This means that pro-growth policies such as low marginal tax rates (especially on work, savings, and investment), restrained federal spending, minimal regulation, and free trade would raise more tax revenues than would be raised by self-defeating tax increases."

 

[Gipper]

That's the bottom line. Increase the GDP, which means getting people back to work, more manufacturing in the US instead of importing everything, that's how we attack the economic situation, a larger market for business, which in turn will hire more workers.



Sounds easy. Now, how do we go about that?

If you had bothered to study history, you would know the answer to your question.

And, it is an easy answer.

 

[Dr.Who]

Higher tax rates mean higher taxes if and only if all the other factors remain the same.

Lower tax rates mean lower taxes if and only if all the other factors remain the same.

When tax rates went down under Reagan, deductions also went down. Some paid less in taxes, others paid more. There are other factors besides tax rates.

Higher taxes means the government has a higher percentage of the GDP.

The reason you keep bringing up tax rates is that you know you can't argue the absurd position that higher taxes does not result in a higher percent of the GDP going to the government.

There are four possibilities:

High rates and high deductions
Hige rates and low deductions
Low rates and high deductions
Low rates and low deductions

And it still does not matter because no matte what has been tried the revenue as a percent of GDP has remained roughly the same.

Not a single income tax plan that has been tried since our record of this has resulted in any higher revenues.

We don't need to wonder what factors are correlated with revenue because we already know - the GDP is the one thing that is correlated with revenue. Higher GDP = higher revenue and lower GDP = lower revenue.


Do I believe that a higher tax that does not include a higher rate could result in more revenue? Yes, taxes such as fees where the gov collects for each of the services it provides could result in higher revenue. No guarantees though. It might also result in a smaller or more limited government. No matter which, it WOULD result in a gov where there was an equalibrium between taxes, services and revenues. And why might such a plan create higher revenue? Because such a plan would not damage the GDP as much as other tax schemes.

 

[Dr.Who]

Yes.

And, it is apparent Dems, libs, progressives, commies, and socialists have NO F-ing idea how to increase GDP...even though American history is replete with examples.

Failing to learn from history means you are one dumb %$#%$#% #$%$&**^.....

Um, they are not concerned with growing GDP. That is not a factor in designing social justice. In fact, I often wonder if they want higher taxes specifically because it results in more government control and would gladly accept a smaller GDP* in exchange for that control.


*smaller GDP = greater suffering for all especially the poor.

 

[Dr.Who]

Fact: Despite the tax rates, the government collected the same amount (roughly) of revenue.

Heritage has an article that analyzed the Bush and Clinton years. Both administrations had times of higher rates and both had times of lower rates. Both administrations had times of better revenue and times of worse revenue. In both administrations revenue did better in times of lower rates - but only within that rough range. The point was not at all that Bush or Clinton was better, but that the lower rates were better, again, within that range. Of course lower rates are better JUST because they permit more freedom for all.

 

[Dr.Who]

OK, so now you're saying that a smaller percent of a larger GDP is better (or at least as good as ) a larger percentage of a smaller GDP. You may actually have a point, there.

Further, a smaller tax could actually result in a larger GDP. So, raising taxes above a certain level is likely to be counter productive.

How do we know what that level is?

If we have an income tax then we know what the best level is by using GenSenica's plan. If I remember correctly it went something like this:

Tax at 16%, expect revenues of 16% and set the budget at 16%. In good years pocket the difference when revenues are higher than 16%. In bad years - break even.

 

[Dr.Who]

That's the bottom line. Increase the GDP, which means getting people back to work, more manufacturing in the US instead of importing everything, that's how we attack the economic situation, a larger market for business, which in turn will hire more workers.

We should first confirm that less imports would result in a higher GDP. Or that the manufacturing sector rather than the service sector will most add to GDP. There are probably a zillion other things that could effect GDP and politicians will never be able to predict or even understand them.

Two words: invisible and hand.

By the way, despite the flack you have received in this discussion it is obvious to me that you are striving admirably to be open minded and explore different ideas that the ones you started this thread with. I am not saying it is always easy for any of us...

 

[Gipper]

Um, they are not concerned with growing GDP. That is not a factor in designing social justice. In fact, I often wonder if they want higher taxes specifically because it results in more government control and would gladly accept a smaller GDP* in exchange for that control.


*smaller GDP = greater suffering for all especially the poor.

Damn Doc...here I thought I was the only one at the HOP with such a critical view of the Left.

I could not agree more with your post.

I believe someone of distinction said it this way, "One of the most insidious things about liberalism is that it disproportionally harms the poor and
under educated the most." No truer words have ever been spoken. We can readily see the terrible harm, but apparently liberals are unable to. I wonder why?

 

[GenSeneca]

The reason you keep bringing up tax rates is that you know you can't argue the absurd position that higher taxes does not result in a higher percent of the GDP going to the government.

In some cases you refer to "taxes" as what government charges (taxes) and in other cases you refer to "taxes" as what government collects (revenue).

Tax: A fee charged ("levied") by a government on a product, income, or activity.​

Revenue: For the government, the increase in assets of governmental funds that do not increase liability or recovery of expenditure. This revenue is obtained from taxes, licenses and fees.​

As anyone can plainly see, taxes are what the government charges while revenue is what the government collects as a result of charging those taxes. So using the word "taxes" as though it's a synonym for revenue is duplicitous.

Let me go back to your above statement...

...you can't argue the absurd position that higher taxes does not result in a higher percent of the GDP going to the government...

If we apply the definition of the word "tax" to your above statement, then you are the one with the absurd position that government charging higher fees results in revenue being a higher % of the GDP. Yet you claim this is not your position...

Instead, you use the word "taxes" to mean revenue. So if we take your use of the word taxes (what's charged) to mean revenue (what's collected), that would make your claim the equivalent of government collecting higher amounts of revenue results in revenue being a higher % of GDP.

If-by-whiskey: in political discourse, if-by-whiskey is a relativist fallacy where the response to a question is contingent on the questioner's opinions and use of words with strong positive or negative connotations. An if-by-whiskey argument implemented through doublespeak appears to affirm both sides of an issue, and agrees with whichever side the listener supports, in effect, taking a position without taking a position.​

 

[Dr.Who]

Damn Doc...here I thought I was the only one at the HOP with such a critical view of the Left.

I could not agree more with your post.

I believe someone of distinction said it this way, "One of the most insidious things about liberalism is that it disproportionally harms the poor and
under educated the most." No truer words have ever been spoken. We can readily see the terrible harm, but apparently liberals are unable to. I wonder why?

I am still wondering about this hypothesis. But with each passing day the only alternative is that policy makers on the left are more stupid than I could believe.

 

[Gipper]

I am still wondering about this hypothesis. But with each passing day the only alternative is that policy makers on the left are more stupid than I could believe.

Stupidty might be the reason for their foolish and continual policy failures. But, The Great One likely nailed it when he said:

Well, the trouble with our liberal friends is not that they are ignorant, but that they know so much that isn’t so. The Great One

We know many lib politicians and policy makers have been extensively educated (ie. brainwashed) at disgustingly liberal biased institutions of higher learning...I suspect that has fogged their minds.

 

[Dr.Who]

Stupidty might be the reason for their foolish and continual policy failures. But, The Great One likely nailed it when he said:


We know many lib politicians and policy makers have been extensively educated (ie. brainwashed) at disgustingly liberal biased institutions of higher learning...I suspect that has fogged their minds.

So you are arguing that they are stupid rather than that they are willing to advance social justice theories at any cost, even knowing the costs?

 

[Gipper]

So you are arguing that they are stupid rather than that they are willing to advance social justice theories at any cost, even knowing the costs?

You certainly could call it stupidity. They have been indoctrinated in liberal think. So, they do not know anything else. And, everything else is to be denigrated and ignored.

For example, BO and friends know much about Keynesian economics (except apparently they do not know it always fails). I doubt they know anything about any other economic theories. They know little of Adam Smith, Hayek, Friedman, Laffer, Sowell, Walter Williams, etc. And, they would have a "closed mind" to any theories that dispute their socialist ideology.

Agreed...their ideology comes first. Whether their policies work or not, is of no concern to them.