People Are Finally Figuring Out: Austerity is Stupid
- Thread starter Banjo
- Start date
Common Oldtime, you cannot think this shallow tax musing by a self confessed 'progressive' journalist has any merit to you. Greg Anrig who wrote these specious '10 reasons' is a political partisan and not much of an economic thinker. He runs a progressive think tank called New Century and he promotes an ideology. He was a member of the Journalist. You might remember the press scandal of 400 liberal journalists participating in an email list communication on how they could promote the Obama campaign. After the scandal broke showing that none of them were objective journalists they disbanded the list back in 2010 and they don't talk about it anymore.
Convertible, since you must think that this article offers good argument against the importance of investing in assets, becuase you linked it, lets Look at his '10 Reasons' point by point:
1. Most cap gains are paid by the rich. Well of course they are! That is one of the things that make them rich! I suppose if the article was about dividends he would announce that most dividends were owned by people who owned stock! Why would it be a surprise, or notable distinction that when people invest in something, or build something and then one day sell it, that they will then pay a capital gains tax when they are rich. Anrig goes on to discuss the issue like the whole universe of cap gains lies in securities and mutual funds. That is a straw man argument because the most economically important capital gains come from the ownership of small businesses. Anrig and his reference to (the liberal) tax policy center data just misrepresents the issue. Do you understand that the income group data and the cap gains data come from the IRS data on adjusted gross income (AGI) of personal income tax returns? When a person works his whole life to develop a businessâ¦say a tire shop in Newark, NJâ¦and they pay themselves well but invest in the business until a day when they decide to sell and retire. In the year that they sell their cap gains income will push them into the highest AGI bracket, even though they were in lower brackets their whole life building the businessâ¦and then after the cap gains year they will return to lower brackets. Anrig and the Tax Policy Center neglect also to explain that most private business income is paid as personal income tax AGI due to the pass through nature of most private business formations. So the highest AGI brackets really conflate personal income and corporate business and partnership income. Anrig deals with it like the issue is all about higher or lower salaries. This whole analysis is misleading garbage.
2. Lower cap gains rates is why the top 1% pay less effective tax. This is misleading for the same reasons as number 1. The top 1% of AGI tax payers is mostly in the 1% because they have corporate income which is not being paid as corporate income. A substantial number of the top 1% of AGI in any one year will be people who have sold major capital assets,â¦.the farm, the store, the medical practice, the factory, the restaurant, the card shop, the beauty salon, etcâ¦.they will only be in the top 1% for that year. Yet, the misrepresentation is that this is a static group that has extraordinary annual income year after year. You also have to understand that a lot of the gain in capital assets is simply inflation, not real gainâ¦.and the money invested in the long asset was after tax income in the first placeâ¦.and if the asset made a profit while it was owned then there was tax on that profit all alongâ¦and then it is taxed again when it is sold for a gain that is mostly inflation anyway. Reducing the capital gains tax is a simplified way to allow for the unfair tax of inflation as gain. It is meant to encourage people to make long term investment commitments even thought they risk having their return diluted by inflation.
3. No evidence of broad economic benefits. Anrig uses specious data here again. He does not propose what metric would best show the effect of capital gains as an economic benefit. He simply compares times of capital gains tax rates with personal savings rates without suggesting how they are supposed to be related or how that relationship shows economic benefit. This comparison means nothingâ¦.as capital flowed into housing because it had a zero capital gains rate it caused mal-investment inflation in an asset that had no income and this investment in housing was not included in the personal savings statisticsâ¦so what does Anrigâs suggestion that there is no correlation with personal savings mean anyway. The middle class sure new their home equity was savings when they lost it in the financial collapseâ¦now personal savings are increasing and investment is declining even though the capital gains tax remains staticâ¦.what does that tell you about savings and capital gains taxâ¦when people have capital losses the tax on the theoretical gain is not then so important. Do you think Anrigâs data accounts for loss carry forward after recessions? What about omitted variables; like the leverage ratios on collateral assets and how that might starve credit for capital investment? None of this purported data and comparison means anything. Then refers to a paper prepared by the Congressional Research Serviceâ¦.that is from the Library of Congress! They donât do serious studies, they provide shallow survey of issues for Congressman on request; this canât be an authority on anything. Then we hear about comparing capital gains tax rates to changes in the GDPâ¦.I have already explained that the GDP only measures growth and not investment in the first place, so this is more garbage.
4. Tax is complex. This is stupid. Did you really like this part Oldtime? I guess I really donât get you at all. The whole code is complex. Why are we not railing against accelerated depreciation for historic buildings? How about phantom income in the event of debt forgiveness outside of bankruptcy? What about deductions for timber land and different import export adjustments? How about the taxation of intellectual property. In the context of our tax code you have to be an ass to put this on a list of reasons not to have low capital gainsâ¦if the tax is higher will it be less complex? The really ridiculous part of this rational is that he includes the argument about pass through entities that I explained above is what makes the use of AGI data to calculate the 1% and effective tax rates into a fraud. You listen to people all day long bullshit you about corporate taxes but they donât tell you that most business taxes are not paid as corporate taxes, they are paid on the personal returns as part of AGIâ¦they they go and tell you that corporate effective tax rate is something like 21% on averageâ¦but they donât tell you that only 14% of business entities report as public C corps and that the number has been declining for two decadesâ¦only includes public companies with bias to the very large multi-nationals. But here you see this liberal progressive knows about pass through enterprise form but doesnât want to tell you how they make the 1% claim into bullshit. He actually wants to use it to support a complexity argument. This is stupid squared. His analysis is all bullshit, the trend the IRS has written about is the decline of the C Corp as a favored form of enterprise organization because it results in double taxation of dividendsâ¦and it marks the rise of the Sub S form of organization along with LLPs and Master limited partnership pass through entities that avoid double taxation. The rise of pass-through enterprise organization represents the character of the real economy businesses that are not public. It is true that private equity benefits from this form also but it is a straw man to suggest they dominate or characterize the trend. These are the hair dressers, the doctors, the store owners, the plumbers, the farmers, the carpet cleaners, electrician and factory owners I was talking about above. This is how the real economy is organized it is not a complex tax avoidance scheme. In fact the effective rate of corporate tax paid by successful pass through corps is much higher than as paid by C Corps. Successful pass through corps that also provides the most new job formation in the economy, pay the highest corporate taxâ¦35%; because they pay business tax at the highest personal level on the personal return and this becomes the AGI data. This is not an argument against low capital gains taxes it is a statement of how hopelessly confused and misinformed the author is.
I know this is quite long but someone might be interested, you never know. I will continue the points in he next post.
Convertible, since you must think that this article offers good argument against the importance of investing in assets, becuase you linked it, lets Look at his '10 Reasons' point by point:
1. Most cap gains are paid by the rich. Well of course they are! That is one of the things that make them rich! I suppose if the article was about dividends he would announce that most dividends were owned by people who owned stock! Why would it be a surprise, or notable distinction that when people invest in something, or build something and then one day sell it, that they will then pay a capital gains tax when they are rich. Anrig goes on to discuss the issue like the whole universe of cap gains lies in securities and mutual funds. That is a straw man argument because the most economically important capital gains come from the ownership of small businesses. Anrig and his reference to (the liberal) tax policy center data just misrepresents the issue. Do you understand that the income group data and the cap gains data come from the IRS data on adjusted gross income (AGI) of personal income tax returns? When a person works his whole life to develop a businessâ¦say a tire shop in Newark, NJâ¦and they pay themselves well but invest in the business until a day when they decide to sell and retire. In the year that they sell their cap gains income will push them into the highest AGI bracket, even though they were in lower brackets their whole life building the businessâ¦and then after the cap gains year they will return to lower brackets. Anrig and the Tax Policy Center neglect also to explain that most private business income is paid as personal income tax AGI due to the pass through nature of most private business formations. So the highest AGI brackets really conflate personal income and corporate business and partnership income. Anrig deals with it like the issue is all about higher or lower salaries. This whole analysis is misleading garbage.
2. Lower cap gains rates is why the top 1% pay less effective tax. This is misleading for the same reasons as number 1. The top 1% of AGI tax payers is mostly in the 1% because they have corporate income which is not being paid as corporate income. A substantial number of the top 1% of AGI in any one year will be people who have sold major capital assets,â¦.the farm, the store, the medical practice, the factory, the restaurant, the card shop, the beauty salon, etcâ¦.they will only be in the top 1% for that year. Yet, the misrepresentation is that this is a static group that has extraordinary annual income year after year. You also have to understand that a lot of the gain in capital assets is simply inflation, not real gainâ¦.and the money invested in the long asset was after tax income in the first placeâ¦.and if the asset made a profit while it was owned then there was tax on that profit all alongâ¦and then it is taxed again when it is sold for a gain that is mostly inflation anyway. Reducing the capital gains tax is a simplified way to allow for the unfair tax of inflation as gain. It is meant to encourage people to make long term investment commitments even thought they risk having their return diluted by inflation.
3. No evidence of broad economic benefits. Anrig uses specious data here again. He does not propose what metric would best show the effect of capital gains as an economic benefit. He simply compares times of capital gains tax rates with personal savings rates without suggesting how they are supposed to be related or how that relationship shows economic benefit. This comparison means nothingâ¦.as capital flowed into housing because it had a zero capital gains rate it caused mal-investment inflation in an asset that had no income and this investment in housing was not included in the personal savings statisticsâ¦so what does Anrigâs suggestion that there is no correlation with personal savings mean anyway. The middle class sure new their home equity was savings when they lost it in the financial collapseâ¦now personal savings are increasing and investment is declining even though the capital gains tax remains staticâ¦.what does that tell you about savings and capital gains taxâ¦when people have capital losses the tax on the theoretical gain is not then so important. Do you think Anrigâs data accounts for loss carry forward after recessions? What about omitted variables; like the leverage ratios on collateral assets and how that might starve credit for capital investment? None of this purported data and comparison means anything. Then refers to a paper prepared by the Congressional Research Serviceâ¦.that is from the Library of Congress! They donât do serious studies, they provide shallow survey of issues for Congressman on request; this canât be an authority on anything. Then we hear about comparing capital gains tax rates to changes in the GDPâ¦.I have already explained that the GDP only measures growth and not investment in the first place, so this is more garbage.
4. Tax is complex. This is stupid. Did you really like this part Oldtime? I guess I really donât get you at all. The whole code is complex. Why are we not railing against accelerated depreciation for historic buildings? How about phantom income in the event of debt forgiveness outside of bankruptcy? What about deductions for timber land and different import export adjustments? How about the taxation of intellectual property. In the context of our tax code you have to be an ass to put this on a list of reasons not to have low capital gainsâ¦if the tax is higher will it be less complex? The really ridiculous part of this rational is that he includes the argument about pass through entities that I explained above is what makes the use of AGI data to calculate the 1% and effective tax rates into a fraud. You listen to people all day long bullshit you about corporate taxes but they donât tell you that most business taxes are not paid as corporate taxes, they are paid on the personal returns as part of AGIâ¦they they go and tell you that corporate effective tax rate is something like 21% on averageâ¦but they donât tell you that only 14% of business entities report as public C corps and that the number has been declining for two decadesâ¦only includes public companies with bias to the very large multi-nationals. But here you see this liberal progressive knows about pass through enterprise form but doesnât want to tell you how they make the 1% claim into bullshit. He actually wants to use it to support a complexity argument. This is stupid squared. His analysis is all bullshit, the trend the IRS has written about is the decline of the C Corp as a favored form of enterprise organization because it results in double taxation of dividendsâ¦and it marks the rise of the Sub S form of organization along with LLPs and Master limited partnership pass through entities that avoid double taxation. The rise of pass-through enterprise organization represents the character of the real economy businesses that are not public. It is true that private equity benefits from this form also but it is a straw man to suggest they dominate or characterize the trend. These are the hair dressers, the doctors, the store owners, the plumbers, the farmers, the carpet cleaners, electrician and factory owners I was talking about above. This is how the real economy is organized it is not a complex tax avoidance scheme. In fact the effective rate of corporate tax paid by successful pass through corps is much higher than as paid by C Corps. Successful pass through corps that also provides the most new job formation in the economy, pay the highest corporate taxâ¦35%; because they pay business tax at the highest personal level on the personal return and this becomes the AGI data. This is not an argument against low capital gains taxes it is a statement of how hopelessly confused and misinformed the author is.
I know this is quite long but someone might be interested, you never know. I will continue the points in he next post.
5. Eliminating capital gains will generate substantial government revenue. It never has when it was tried before. It has only raised taxes in the quarter before the tax increase goes into effect and thereafter the revenue declines until it stabilizes at a lower than projected level. It always grows about projection when it is lowered. This assumption ignores the school of economics called âbehavioral economicsââ¦that part of the dismal science that found that people make choices according to incentive and perceived penalties. You have to remember that rich people, the ones who own capital investment and make capital investments, the farmers, professionals, and business owners, donât have to sell their businesses. One of the things you get when you are well off is that you get to make choices for yourself, you can choose when and how you want to take accumulated income. You can also take it out of you capital assets through leverage if you thing the tax cost of selling is too high. You donât pay tax on debt when you take it out that way and the pay back reduces the current earnings so, reduces ongoing income tax also. The biggest reason to have a low capital gains tax is to discourage a âlock inâ effect where people avoid the tax all together by not selling and instead taking cash out as debt. This locks capital into less productive uses that it otherwise might be employed, and it raises less revenue. It also reduces other transaction taxes that state and local governments rely on, not to mention all the expenses in the real economy that tied to capital transaction flow. The OMB data assumes that people will behave the same with transactions no matter the tax rate; this is a false premise. We know that people donât behave that way.
6. Capital Gains are favored even without exclusion. Again Anrig makes an argument that contradicts his earlier points without realizing what he is suggesting. He is arguing the lock in effect, the fact that people donât have to sell capital assets when the tax is seen as too high, as some sort of tax break. He is moron. People save taxes by not making a gain. You know this guy canât wait to promote a wealth tax to get around the bastards who refuse to sell the farm or slaughter the fatted calf. We see the bias of progressives to think in terms of commanding economic behavior rather than taking responsibility for the incentives and reactions to penalties that they create in the path of fee people aspiring to grow on their own account. It is hard to keep reading his article when you realize he considers the decision to remain an owner operator as a tax break. He is a moron. Then he goes on to make the typical misrepresentation about the death tax. Sure the current estate tax code provides for a rise in basis of capital assets to the value at the time of deathâ¦.but; you have to pay estate tax on that value. What they promote as a tax break from the estate tax code is not a tax break at all, it is just the code noticing that it would be unfair to charge an estate tax on the capital at one value and then tax it again on a lower basis as capital gainsâ¦it would be double tax. The estate tax acts like a capital gains tax so the future capital gains tax should be based on the value at the time the estate tax was levied. Calling this a tax break is like someone coming and stealing your lunch sandwich and then telling you that he is going to give you a break and not make you buy him another one. Mark up in basis is not a capital gains break, the owners of the capital, the heirs; pay an estate tax on the capital instead. Here we see the same simple minded misrepresentations and shallow deceits meant to obscure what is really happening. The author must assume that all of his readers are idiots who know nothing about the issue.
7. Defenders of the tax exclusion are a well funded lobby of the rich. Anrig should be embarrassed by this argument since he runs a foundation created from the fortune of a rich Bostonian, Filene, in the early 1900âs, which he directs to promote liberal progressive tax ideasâ¦like this article. There is no shortage of money and lobbying power on the progressive side. To suggest that there is, especially when you run a foundation that has had enough funding to last for a century, can only be understood as lying. Itâs not like the POTUS and the Democratic Leadership that controls the Senate does not propagandize and campaign to raise the capital gains tax. Anrig is like a Roman who has buried the Christians up to their necks in the Coliseum and turned the lions lose, but then stands up and yells âFight fair Christians!â as they try to bite the attacking lions. This is a silly argument that is contradicted by the reality that anyone can see; both sides are funded and you have to look through the deciets and exaggerations to find the truth. All Anrig has to do is call Soros if he wants more money to propagandize the ignorant.
8. Investment decisions should be driven by risk reward instead of tax. Anrig would have us once again consider that the issue is only about publically traded stocks rather than about the fabric of private assets and businesses in the real economy. Tax considerations should not be the basis for a deal but it is foolish not to consider tax consequences that tax inflation as well as gain at a now proposed higher rates of one third of the gain. Any sensible person who faces aggressive operating taxes and regulations and an uncertain rate of return must think twice when a hard earned gain over long time will be reduced by more than one third once it is liquidated. Even if the entrepreneurial impulse and risk calculus can overcome the threat of excessive future tax in the decision to start a business, the whole point is that it will weigh more heavily at the margin when it comes time to decide when to sell a business or how to rearrange its financial structure. It is after all the decisions on sale and continuing growth that are most impacted at the margin by the rate of gain tax on sale.
9. Reagan raised the Cap Gains rate to pass the 1986 tax reform. Here Anrig is being disingenuous because he knows it was a compromise that Reagan would have preferred not to make. He thought it was worth it to get the top rate down from 50% to 28%. The rise in the capital gains tax along with the disallowance of deductions of passive losses from AGI income was one of the main causes for the collapse of real estate development that began after the 1986 law was passed and resulted eventually in the collapse of the S&L industry and highest amount of bank failures since the Great Depressionâ¦even more than we have faced in the latest crises. Of course Anrig doesnât get into this but deceives by suggesting that Reagan favored the rise in capital gains exclusion and that the rise did not have negative consequences. It is discussed often but the 1986 tax bill precipitated the S&L crises. It removed the value from commercial real estate that was tied up in tax arbitrage between the high income tax rate of 50% and the low capital gains rate of 20%. A whole sector of the economy was leveraging real estate investment to generate passive losses that could be deducted from current income and then paid back with future capital gains at a lower rate. This over leveraging of real estate by the recently deregulated S&L industry chasing yield to compensate for the decade of disintermediation through inflation had created a commercial real estate bubble that the 1986 tax law intentionally popped all at once. Of course they were shooting at the tax shelters but hit the S&Lâs by mistake. The lesson in that little understood mistake was that there is an important relationship between capital gains rates and how the exclusion is qualified in terms and the regular income rates. If he spread is too large and the qualification of the exclusion is too short the differential will cause distortions. Anrig could have used this as an argument against capital gains, and it would have been better than any of his â10, âbut he really doesnât know what he is talking about.
10. Income from Capital should be taxed the same as income from âWorkâ as a matter of principle fairness. Here again, Anrig assumes that all capital gains behavior is men of leisure trading stocks. That is really as stupid view. The issue of capital assets in the real economy is much more than public stocks and the capital does not run itself. As I have stated above it is the businesses of the real economy we are talking about. It is land, timber, a sugar bush, a dairy farm, a driving range, a Carvel store, the dentist, an adaptive reuse of an historic building that is rented to lawyers, a car repair business, a brew pub, a winery, a hotel, a fleet to limousines and on and on. This is the stuff of the real economy and the lives of people who build wealth through the creation and maintenance of real assets. It is the value of these assets built over years in a life that Anrig would steal away. All these people who build these businesses that do not become IBM or face book, hire people, train people, buy goods and services from other businesses that hire and employ, even from IBM. Anrig would have all employed in the labor of digging ditches without backhoes. Even Communist China understands that is not really a fair or principled outcome.
Convertible, this ideological progressive hack of a think tank âjournalistâ has nothing insightful or honest or so important to say about the issue of investment and assets and their role in wealth creation and economic growth. You should learn more about it, read better stuff, so that you don't get fooled again.
Now that I took this apart for you, why donât you take us through the other article you pasted to on a point by point basis?
6. Capital Gains are favored even without exclusion. Again Anrig makes an argument that contradicts his earlier points without realizing what he is suggesting. He is arguing the lock in effect, the fact that people donât have to sell capital assets when the tax is seen as too high, as some sort of tax break. He is moron. People save taxes by not making a gain. You know this guy canât wait to promote a wealth tax to get around the bastards who refuse to sell the farm or slaughter the fatted calf. We see the bias of progressives to think in terms of commanding economic behavior rather than taking responsibility for the incentives and reactions to penalties that they create in the path of fee people aspiring to grow on their own account. It is hard to keep reading his article when you realize he considers the decision to remain an owner operator as a tax break. He is a moron. Then he goes on to make the typical misrepresentation about the death tax. Sure the current estate tax code provides for a rise in basis of capital assets to the value at the time of deathâ¦.but; you have to pay estate tax on that value. What they promote as a tax break from the estate tax code is not a tax break at all, it is just the code noticing that it would be unfair to charge an estate tax on the capital at one value and then tax it again on a lower basis as capital gainsâ¦it would be double tax. The estate tax acts like a capital gains tax so the future capital gains tax should be based on the value at the time the estate tax was levied. Calling this a tax break is like someone coming and stealing your lunch sandwich and then telling you that he is going to give you a break and not make you buy him another one. Mark up in basis is not a capital gains break, the owners of the capital, the heirs; pay an estate tax on the capital instead. Here we see the same simple minded misrepresentations and shallow deceits meant to obscure what is really happening. The author must assume that all of his readers are idiots who know nothing about the issue.
7. Defenders of the tax exclusion are a well funded lobby of the rich. Anrig should be embarrassed by this argument since he runs a foundation created from the fortune of a rich Bostonian, Filene, in the early 1900âs, which he directs to promote liberal progressive tax ideasâ¦like this article. There is no shortage of money and lobbying power on the progressive side. To suggest that there is, especially when you run a foundation that has had enough funding to last for a century, can only be understood as lying. Itâs not like the POTUS and the Democratic Leadership that controls the Senate does not propagandize and campaign to raise the capital gains tax. Anrig is like a Roman who has buried the Christians up to their necks in the Coliseum and turned the lions lose, but then stands up and yells âFight fair Christians!â as they try to bite the attacking lions. This is a silly argument that is contradicted by the reality that anyone can see; both sides are funded and you have to look through the deciets and exaggerations to find the truth. All Anrig has to do is call Soros if he wants more money to propagandize the ignorant.
8. Investment decisions should be driven by risk reward instead of tax. Anrig would have us once again consider that the issue is only about publically traded stocks rather than about the fabric of private assets and businesses in the real economy. Tax considerations should not be the basis for a deal but it is foolish not to consider tax consequences that tax inflation as well as gain at a now proposed higher rates of one third of the gain. Any sensible person who faces aggressive operating taxes and regulations and an uncertain rate of return must think twice when a hard earned gain over long time will be reduced by more than one third once it is liquidated. Even if the entrepreneurial impulse and risk calculus can overcome the threat of excessive future tax in the decision to start a business, the whole point is that it will weigh more heavily at the margin when it comes time to decide when to sell a business or how to rearrange its financial structure. It is after all the decisions on sale and continuing growth that are most impacted at the margin by the rate of gain tax on sale.
9. Reagan raised the Cap Gains rate to pass the 1986 tax reform. Here Anrig is being disingenuous because he knows it was a compromise that Reagan would have preferred not to make. He thought it was worth it to get the top rate down from 50% to 28%. The rise in the capital gains tax along with the disallowance of deductions of passive losses from AGI income was one of the main causes for the collapse of real estate development that began after the 1986 law was passed and resulted eventually in the collapse of the S&L industry and highest amount of bank failures since the Great Depressionâ¦even more than we have faced in the latest crises. Of course Anrig doesnât get into this but deceives by suggesting that Reagan favored the rise in capital gains exclusion and that the rise did not have negative consequences. It is discussed often but the 1986 tax bill precipitated the S&L crises. It removed the value from commercial real estate that was tied up in tax arbitrage between the high income tax rate of 50% and the low capital gains rate of 20%. A whole sector of the economy was leveraging real estate investment to generate passive losses that could be deducted from current income and then paid back with future capital gains at a lower rate. This over leveraging of real estate by the recently deregulated S&L industry chasing yield to compensate for the decade of disintermediation through inflation had created a commercial real estate bubble that the 1986 tax law intentionally popped all at once. Of course they were shooting at the tax shelters but hit the S&Lâs by mistake. The lesson in that little understood mistake was that there is an important relationship between capital gains rates and how the exclusion is qualified in terms and the regular income rates. If he spread is too large and the qualification of the exclusion is too short the differential will cause distortions. Anrig could have used this as an argument against capital gains, and it would have been better than any of his â10, âbut he really doesnât know what he is talking about.
10. Income from Capital should be taxed the same as income from âWorkâ as a matter of principle fairness. Here again, Anrig assumes that all capital gains behavior is men of leisure trading stocks. That is really as stupid view. The issue of capital assets in the real economy is much more than public stocks and the capital does not run itself. As I have stated above it is the businesses of the real economy we are talking about. It is land, timber, a sugar bush, a dairy farm, a driving range, a Carvel store, the dentist, an adaptive reuse of an historic building that is rented to lawyers, a car repair business, a brew pub, a winery, a hotel, a fleet to limousines and on and on. This is the stuff of the real economy and the lives of people who build wealth through the creation and maintenance of real assets. It is the value of these assets built over years in a life that Anrig would steal away. All these people who build these businesses that do not become IBM or face book, hire people, train people, buy goods and services from other businesses that hire and employ, even from IBM. Anrig would have all employed in the labor of digging ditches without backhoes. Even Communist China understands that is not really a fair or principled outcome.
Convertible, this ideological progressive hack of a think tank âjournalistâ has nothing insightful or honest or so important to say about the issue of investment and assets and their role in wealth creation and economic growth. You should learn more about it, read better stuff, so that you don't get fooled again.
Now that I took this apart for you, why donât you take us through the other article you pasted to on a point by point basis?
no,you don't get me. What I meant was reason 4 cracked me up. Why doesn't he tell me to my face with a straight face, "You're going to lose your cap gains break, but it will save you a few minutes at the end of the year when you do your taxes." He must think my time is extremely valuable.
In spite of all the pontificating in one direction or another, one fact remains overwhelmingly supported by actual economic data and that is that increased spending is a far more effective means of stimulating the economy in times of recession than are tax cuts. Keynes has been shown to be right!, at least with regard to the first half of his prescription for evening out an economy. If the second half of his prescription were ever to be properly applied during boom times, I have little doubt the data would show that he was right there as well. What a brilliant economist he was! He dared to use common sense. When you're an economist, that is an act of nearly unspeakable bravery. 
P.S. Please take these remarks at face value, and do not try to read into them anything political.
P.S. Please take these remarks at face value, and do not try to read into them anything political.
Quote from piezoe:
In spite of all the pontificating in one direction or another, one fact remains overwhelmingly supported by actual economic data and that is that increased spending is a far more effective means of stimulating the economy in times of recession than are tax cuts. Keynes has been shown to be right!, at least with regard to the first half of his prescription for evening out an economy. If the second half of his prescription were ever to be properly applied during boom times, I have little doubt the data would show that he was right there as well. What a brilliant economist he was! He dared to use common sense. When you're an economist, that is an act of nearly unspeakable bravery.
P.S. Please take these remarks at face value, and do not try to read into them anything political.
Keynes said in times of crisis cut taxes and grow your way out.
http://reason.com/blog/2012/04/17/keynes-the-closet-supply-sider
Quote from piezoe:
Oh, damn. My retort lacks originality. Shit!
Well, actually, if you really want to get down & dirty, it showed a complete lack of actual thought. It's a lazy and cliched response.
You're right about Keynes, btw. His appreciation of risk and what we now call tail events and how it figures into economic stuff was unmatched for his time, and way underappreciated now (Taleb, weirdly, notes he was an excellent probabilist, and then decides he was useless). Only Minsky seems to have understood that.
Piezoe, you wrote: "one fact remains overwhelmingly supported by actual economic data and that is that increased spending is a far more effective means of stimulating the economy in times of recession than are tax cuts." That is simply wrong. You say it, but you offer nothing to show it, not even a reference to any study.
The accepted academic expert on the subjec is Christina Romer and she has written the seminal paper on the subject which we have discussed in this thread and where you can find a link to the paper.
I don't agree with Christina Romer on most things and I have criticised her paper but she is the one who put the data together in a paper and her paper is the standard on the issue. I have to tell you that she says you are wrong. Her studied conclusion is that there is more benifit from tax reductions...though she really can't prove a 'multiplier' from either strategy.
The accepted academic expert on the subjec is Christina Romer and she has written the seminal paper on the subject which we have discussed in this thread and where you can find a link to the paper.
I don't agree with Christina Romer on most things and I have criticised her paper but she is the one who put the data together in a paper and her paper is the standard on the issue. I have to tell you that she says you are wrong. Her studied conclusion is that there is more benifit from tax reductions...though she really can't prove a 'multiplier' from either strategy.