American Elephants


Maybe She Could Teach Economics Instead. by The Elephant's Child

Here are Speaker Pelosi’s actual words from today. She’s even more deluded than I thought. Her “multiplier effect” is a whole 2, not 1.5 as I had thought. For every dollar you put into the economy, you get two back!  We can just shut down the government, put all the money out in the economy any old way and get double your money back.

Shazam!  Why no time at all and we’d have the deficit all paid off, and the debt too.  Maybe Ms. Pelosi can take her program to Europe. They’re having budgetary problems as well.

But we can’t let her get away with the claim that they would be giving “the rich” $700 billion.  They want to take $700 billion more away from “the rich.” They want to raise their taxes. Democrats, conveniently, cannot get their minds around the fact that a large percentage of “the rich” are single proprietorships, or partnerships, of subchapter S corporations who are filing their business tax returns as individuals.  When you raise taxes on those folks, you kill more jobs.



Unemployment Benefits Are the Best Way of Creating Jobs? by The Elephant's Child
December 2, 2010, 6:03 pm
Filed under: Capitalism, Democrat Corruption, Economy | Tags: , ,

Nancy Pelosi made this claim again today, that unemployment benefits are the best way of creating jobs. President Obama said essentially the same thing — that unemployment benefits will be spent right away. Since the unemployed are hard-up, they will spend their benefits immediately, and then that money will s-l-o-w-l-y circulate through the economy creating “multiplier effects” which Christina Romer pegged at somewhere over 1.5% — to which some other economist said — obviously, all you have to do is dump $1 trillion into the economy, and you will get $1.5 trillion back.  You don’t even have to do anything else, just keep dumping money into the economy and — oh wait!!!  That’s what we have been doing.

Consumer demand is a consequence, not a cause, of economic growth.

I have an idea.  If we can just get President Obama to stop destroying jobs, I’d bet things would pick up right away.  The moratorium in the Gulf of Mexico cost something over 32,000 jobs, some rigs have left the Gulf, and although the moratorium is over, new drilling permits are not being issued — even for shallow water wells which have had no safety problems at all.  When Congress banned incandescent lightbulbs, to please GE, the incandescent factories closed permanently, and twisty bulbs now come from China.

The administration has subsidized  several electric battery factories, but there is a glut of batteries, and no market.  When you hike the minimum wage, you raise the unemployment rate.  Mandating health insurance shuts down small businesses.  Raising the cost of energy kills jobs, and requiring the use of renewable energy raises the cost of energy.  Denying permits to the coal industry (Obama said he would  bankrupt Coal) kills jobs.  Defunding the Yucca Mountain nuclear waste repository kills jobs.  And bashing business, particularly small business as represented by America’s Chambers of Commerce doesn’t help.  I could go on, but you get the idea.



There Are No Tax-Cuts On the Table! by The Elephant's Child
December 2, 2010, 4:04 pm
Filed under: Capitalism, Economy, Freedom, Taxes | Tags: , ,

The Hoopla in the House of Representatives has many people confused.  The subject is the Bush Tax Cuts from 2001 and 2003.  George W. Bush was able to get tax cuts for all Americans passed.  Democrats cried “Tax Cuts for the Rich”, but “the rich” got the smallest percentage tax cut of all, and the bottom 40% of taxpayers had to pay no income tax at all.  To get the bill passed, the tax cuts came with an expiration date, which is December 31,2010. Which means that if they are not extended, your taxes will go up — a lot.

Most sentient human beings know that it is supposed to be a very bad idea to raise taxes during a recession, when the economy is struggling to recover. It’s a bad idea politically to raise taxes on the middle class — they don’t like it, and there are a whole lot of them.  But to the leftist mind, “the rich” are very bad people, which is odd, because a great many of them are very rich indeed.  So we have to assume that they believe that disparaging the rich helps them politically.

A recent poll showed that 78% of all those queried said that they would like the tax cuts for households earning under $250,000 to be extended either permanently or for a few years or until the economy fully recovers.  Democrats agreed by 73%.  What about “the rich?” A solid majority (56%) said they wanted tax cuts extended for households with more than $250,000 in income.  Only 39% wanted the rich to pay more.Support for letting the tax cuts be made permanent for the rich is overwhelming for both Republicans and Independents at 63%.  Democrats oppose this by 55%.  Democrats hate tax cuts.

President Obama has claimed that Republicans want to give “the rich” another tax cut, which will cost the Treasury $700 billion which they will have to borrow from other countries.  This is patently false.  Republicans are trying to keep the Democrats from raising your taxes.  Refusing to extend the Bush tax cuts means that taxes would go up for everybody. Capital gains taxes would rise from 15% to 20%.  Estate taxes which are zero right now, would climb to 55% — or over half of anything over $1 million.  To claim that leaving tax rates for the rich right where they are would cost $700 billion simply means that Obama is counting his chickens before they hatch.  He expects $700 billion to come in from increased taxes on the rich — but the rich are perfectly capable of rearranging their finances to they don’t have to pay more.

There are no tax-cuts on the table.

Estimates from the respected Heritage Center for Data Analysis show that over 10 years, letting the bush cuts expire would slash $1.1 trillion from GDP, kill 6.9 million jobs, reduce overall business investment by $330 billion and lower Americans’ disposable income by $726 billion.  A real disaster.

The Twentieth Amendment intended that there would be no such thing as a “Lame Duck Session.”  The amendment was ratified on January 23, 1933, when travel was a lot slower, and no one considered that members of Congress could dash back to the Capitol for another session after the election had been determined.  When a business fires anyone, their things are packed up and they are escorted off the premises immediately, with the undercurrent that they might commit an act of sabotage if they were allowed to linger.  A goodly percentage of the members of Congress have been fired, but they are back in he Capitol building committing what political sabotage they can manage.

This chart from the Heritage Foundation shows that tax receipts as a percentage of GDP remain relatively constant no matter what the top individual tax rate.  (Click to enlarge).




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