[I'm going to rework this post over the weekend. Just had to get it off my chest in this rambling form.]
We’ve heard it again and again: Tea Party protesters are idiots for protesting higher taxes, because the President has given them almost $200 billion in tax cuts. Of course, the Tea Partiers are really talking about the inevitable downstream tax increases which will occur due to the expansion in entitlement spending, but let’s ignore that inconvenient fact and focus on the tax cuts themselves.
Tax cuts. Tax cuts mean different things to different people. When a conservative talks about tax cuts, he’s talking about permanent (or at least long-term) across-the-board cuts in the federal income tax rates. Not a one-off tax rebate. Not an incentive program to get you to buy a car or house. Not educational tax breaks or tax breaks on unemployment benefits. And not tax credits for lower income families.
Why is the difference important? All of the ARRA tax cuts are temporary – you can’t adjust your spending/savings habits on a permanent basis, so you just take the savings this year and keep hunkering down. So there’s a small one-time relief (two-times in the case of Making Work Pay), and it’s over. The Making Work Pay tax rebate is as stupid as Bush’s tax rebates were.
One of my least favorite things about government is the way it incentivizes social behavior and private spending through taxation and benefits. The public money spent is applied to only a small subset of the populace, and the incentives often lead to unexpected consequences.
So I’ll agree that Obama has implemented a number of expensive tax cuts. But I don’t think they’re economically stimulating, fair, or even moral. Particularly when we have to borrow money to pay for them.
April 16, 2010 at 10:46 am
Geoff, Very well written post! A-plus. And you know coming from me that says a lot. ;)
I have a youtube video I made that illustrates my view on taxing social behavior. I think you might find it compelling. Can I post it here?
P.S. Well done job of getting me to visit your blog, whether intended or not. I hope you will let me comment. Thank you.
p.p.s. If it is okay to post my youtube, just indicate here. :)
April 16, 2010 at 10:50 am
I don’t mind if you put a link to it: I’d prefer not to have the ginormous YouTube picture sitting in the thread.
Although I’ll admit that I don’t use this blog much anymore, so there’s very little traffic. So it doesn’t matter that much.
April 16, 2010 at 10:52 am
I absolutely agree…. except on one point of nomenclature–
There’s a commonly-accepted term for what Obama and Congress have done: Tax expenditures. A tax expenditure is a specific tax preference given to a narrow range of recipients or activities, in order to encourage certain behavior through the tax code rather than by direct appopriation.
Calling them “tax cuts” flies in the face of the commonly understood terminology of teh last 30+ years. Until now, no one has called them tax cuts, to my recollection—thay have been tax expenditures or tax credits or tax deductions, but the words “cuts” and “reductions” have been reserved for rate changes.
But, what else should we expect from this lying, decietful, dishonest… oh, hell.
April 16, 2010 at 10:54 am
Thanks, Marty – I’ll amend the post this weekend.
It needs a graph or two.
April 16, 2010 at 10:57 am
Geoff, Here’s the link. YOu might find it interesting. A harrasser actually exposed my full name to the public! He has been harrassing me for months and he has finally taken it another step. Check this out:
April 16, 2010 at 10:58 am
oh sorry, Geoffy. That was the wrong video! I meant to share my taxation one!
April 16, 2010 at 11:00 am
Here’s the one I meant to share. But you might find the other one interesting anyway, considering the threat and then the carrying out of said threat.
April 16, 2010 at 1:49 pm
Geoff-
This is a great take on taxes. My husband and I recently purchased a CPA practice.
And you are correct in how you explain it so even a liberal can understand it!
April 17, 2010 at 7:47 am
I honestly think his biggest whopper is the claim to have cut taxes to small businesses. New hire credits (assuming, of course, you didn’t lay anyone off – it’s a net dealo) isn’t much of a tax cut.
It’s idiotic. No one is going to “hire” someone for that credit. The ONLY reason to hire someone is need. Otherwise you put your business at risk.
April 17, 2010 at 11:36 am
Nice post. It’s funny the way tea party folks like me get called stupid because we are not stupid enough to fall for their lies.
April 17, 2010 at 11:15 pm
Wonderful analysis and explanation. Obamao deserves no praise for wrecking the economy.
April 19, 2010 at 2:52 am
You nailed it Geoff. All or nearly all of what are called “tax cuts” in the ARRA are not a general reduction in tax rates. They are, instead, temporary “tax credits:”
tax credit – a provision of the tax code that specifies an amount by which a taxpayer’s taxes will be reduced in return for some behavior.
So, “tax cuts” from the Left are not: keep more of your money for you to decide what to do with; they are: we will decide what you must do in order to keep more of your money.
April 19, 2010 at 6:46 am
So, “tax cuts” from the Left are not: keep more of your money for you to decide what to do with; they are: we will decide what you must do in order to keep more of your money.
I like that summation, but the second half might be more like:
“If you do what we want, we’ll give you back some of your own money to help pay for it.”
April 19, 2010 at 11:43 am
I loved the big obama tax cut…..I saved the extra money in my check for 2 1/2 months and used my windfall profit to buy a carton of cigarettes. Unfortunately, obama bummed two packs out of the carton ($1.01 fed tax per pack)……The obama giveth and the obama taketh away.
April 19, 2010 at 2:57 pm
Good point about the tax cut label — lame under Bush; lame under Obama.
Regarding the tea partiers, the recent NYT poll shows they’re not idiots — they’re just another fringe group with no implementable or practicable idea about how to solve our economic problems. But then, being loud and angry is so much more fun (and easier) than coming up with workable solutions.
As a smart guy once said: “Rallies are not constructive. They lend nothing to the understanding or discussion of the issues – in fact, they’re counterproductive. From what I see, 95% of the people at most rallies are there to satisfy their need to feel relevant or righteous (or to show off their impressive plumage). If they were serious about the issues, they’d be doing analysis and pushing policies, not waving signs and shouting.”
They’re also hypocrits — overwhelmingly for smaller govt, while nearly 50% are covered by Medicare or receiving Social Security benefits (not to mention 65% w/ kids in public schools).
Hey, as another smart guy once said: Vox populi, vox humbug
April 19, 2010 at 3:23 pm
You have a pretty media-biased view of Tea Parties. There have been very few accurate portrayals of Tea Partiers in the press. Yes, probably 10% of the Tea Partiers are fringe loonies. But the rest are pretty normal.
I don’t go to the rallies because I agree with the smart guy (heh heh). I still don’t think they do much constructive in terms of policy analysis and discussion. But I have to admit that they’ve been a slap upside the head for politicians who were completely ignoring their concerns.
50% are covered by Medicare or receiving Social Security benefits (not to mention 65% w/ kids in public schools).
So sayeth the poll, but those responses seem pretty contradictory to me. In any case, you’ve perpetuated your perpetual error of conflating federal and local government services. Stop it. Stop it now. Every time we talk about federal income taxes, you bring up schools. They have very little to do with one another (before NCLB they had even less).
As to the Medicare/Social Security angle – these people are locked into the system now. What are they going to do unless you propose a transition scheme to the private market? This is a major reason why I was opposed to Obamacare. Once it starts, it can’t be undone.
Not to mention that having paid into Social Security for almost 30 years at this point, even though I hate it on philosophical, economic, and practical grounds, I’m darn well planning on getting my money out of it.
April 19, 2010 at 3:44 pm
geoff said: “…even though I hate it on philosophical, economic, and practical grounds, I’m darned well planning on getting my money out of it.”
geoffy, that’s part of the problem. Everyone feels entitled to what they think they deserve. It doesn’t matter if you deserve it, or even earned it, or not. Doesn’t matter if forgoing your s.s. benefits will help your children or grandchildren, or other Americans who really need it.
I used to think that social security should be changed to social insurance. Something to fall back on if things don’t work out so good in your retirement. But like buying auto insurance, if you don’t need it, you just keep paying and never get a return. Why not? In all my 35 plus years of driving, I’ve never had an accident that required my insurance company to pay. I’ve paid thousands of dollars in my lifetime. I don’t even want to calculate how much. Maybe I should demand a return.
Anyway, that is just my suggestion. Feel very FREE to tear it apart. It’s a FREE country, still.
April 19, 2010 at 3:46 pm
And I guess I am suggesting it. I said “I used to” think, but I think this could help stem the depletion of all Social Security, which we all know is coming.
April 20, 2010 at 8:09 am
in my opinion, your writing is very good and very useful
April 20, 2010 at 2:00 pm
Sorry about that fed tax/public schools conflation – old habits die hard.
And this doesn’t get me off the hook, because I wasn’t thinking it while I wrote the prev comment, but don’t you think Tea Party anti-tax grumblings extend down to the local level? I’d be surprised, for example, if the NJTP platform didn’t include some position against too-high property taxes…though I don’t have time to verify that — gotta get home and vote for our town’s school budget.
And I agree with above – your writing is very good and very useful (seriously).
April 20, 2010 at 3:08 pm
don’t you think Tea Party anti-tax grumblings extend down to the local level?
No. They are focused on what they see as downstream federal tax increases based on the sudden expansion of entitlements and deficit spending.
Notice that there are no Tea Parties or townhall meetings for state legislators or school boards.
And I agree with above
I’m pretty sure that that’s a spambot. I left it there because I thought it was funny.
April 20, 2010 at 4:00 pm
@ nooneofanyimport: If that was directed at me, I’m sorry if you took offense. That video was made in response to a lot of accusations being thrown by both sides. I made objective videos of my local tea party last year and posted them on cnn ireports. I don’t agree with some of their ideas, but I love free expression.
The video I put together happens to show my neighbors expressing how they feel. Some are delusional; some make perfect sense. I chose the most interesting one’s that I hadn’t used in previous videos. And I’ve made a lot. So, that is actually some of the most extreme footage, that I left out of previous vids. I also discovered the implied “infiltration” of our local tea party that I hadn’t noted before. I just thought it compelling. Not trying to make trouble for the tea party or my neighbors. I have friends everywhere.
April 20, 2010 at 6:55 pm
hey, thx for being concerned rosehips. I didn’t see your vid though, I was referring to the first sentence in Geoff’s post. no worries aabout offending me; getting thicker skin in the past year lol
April 21, 2010 at 8:13 am
I get that the original Tea party movement was in response to federal stuff, but I think some locals have wandered off the rez…I googled “tea party property tax” and found TP local tax protests in Tallahassee, Albuquerque, Anchorage…that was pg 1 of results — didn’t look past there.
April 21, 2010 at 8:34 am
@ noone, lol. I’m always thinking things revolve around me.
One guy in my tea party vid talks a lot about the gov’t doing “stupid” things. I actually edited a vid that repeated this guy’s rant. It was kinda funny, but a little mean.
April 21, 2010 at 8:38 am
@ Mark. My local tea party last year included a lot of local folk complaining about local taxes. I never included them in any of my published vids because they were too localized. I could put together a 5 minute vid that only complains about property, sin taxes, assessments, utility rates, etc etc.