toldailytopic: Taxing more or spending less? Which is the most wise path to reduce th

[rexlunae]

The supermajority must exercise fiscal discipline in order to fix the structural deficit that exists in the state budget. State Controller John Chiang, a Democrat, issued this chilling warning when revenues fell 10.8% below their expected return in November, “This serves as a sobering reminder that, while the economy is expanding, it is doing so at a slow and uneven pace that will require the State to exercise care and discipline in how its fiscal affairs are managed in the coming year.” - source

Couple of problems with that. For one, we voted to raise taxes in November. It hadn't happened at this point. Also, the 10.8% shortfall was versus a projection of expected revenue with stable tax rates, not based on a change in rates. So, it doesn't support the Laffer Curve.

w/rt Texas: Something else that doesn't support the Laffer Curve: Increases in tax revenue due to an energy boom.

 

[resurrected]

You've brought this point up before against other posters. I'm not sure whether or not you've brought it up against me. The most recent context was in the healthcare debate, right?

Yes, I usually use it as a /thread in those debates.

I don't think that this follows. Yes, I grant that it's probably in the interest of the state to make sure that all of the citizens are fed and housed. It doesn't follow from this that it is the duty of the State to subsidize all housing and/or food directly (though it does probably justify at least some government action, at least in some cases).

You appeared to be making the argument that that which is in the interest of the state should be funded by the state.

There is a disproportion between medicine or education versus housing and food.

I agree. Absent urgent medical need, shelter and food are lower on Maslow's needs hierarchy.

"What do you want for dinner tonight?" Even if I stipulated that you must answer with a meal which is nourishing (not lacking in nutritional value), there's any number of answers that you could give me.

Again, "where do you want to live, and what kind of housing accomodations do you want or need?" There's any number of answers that you could give me, depending upon your own needs and desires.

Food
Shelter


Primary needs

And yet you don't recognize them as being something the state should routinely fund.

But consider the question: "What ought you to know?" There is some variance in the way that you might answer that question. But not nearly as much. There are certain things that everybody should know in order fully to participate in our society.

A better question would be, what kind of an education should the state provide? Should it pay for my child to go to Harvard or Cornell if they are capable of succeeding in those environments? If not, why not?

Again, consider the question: "What kind of medical care do you want?" There's really not much variance in the range of probable answers. The answer is: "I want to be healthy. I want a doctor to figure out what is necessary for me to be healthy, and then I want access to the things that he says that I need in order to be healthy."

There's no reason for the average person in this day and age to require a doctor to figure out what is necessary to be healthy.

Eat healthy, get plenty of fresh air and exercise.

 

[drbrumley]

This would be extremely unjust.

But it is just to pay for someone else....and then someone else pay for me etc....?

It's directly in the interest of the State to educate the young.

Really? Why is that?

 

[drbrumley]

Gang of thieves....

 

[drbrumley]

I think that there is a debt of justice which the better off among the citizenry must pay to the less well off of the citizenry, which the younger must pay to those who are older and no longer should be expected to work. You can say that it's not something that's the government's business, but the tithes of the Mosaic Law seem to beg to differ.

What in the hell do you think justice stands for? What crime would the younger have committed to pay for the older? How absurd of you. Justice he says.....

 

[exminister]

I think that there is a debt of justice which the better off among the citizenry must pay to the less well off of the citizenry, which the younger must pay to those who are older and no longer should be expected to work. You can say that it's not something that's the government's business, but the tithes of the Mosaic Law seem to beg to differ.

Traditio,
I like what you are saying. I have listened to the speech-ifying on the senate and house on cspan. It was driving me crazy because all they were arguing about was taxes. All that wasted breathe could have been on how and what spending was going to be cut. But they all are gutless including the American people. We as a people cannot look at this in a rational and caring way. When my budget is out of whack I need to take out all the fear and face it squarely. I don't need to react, but act.
Part of the increase in taxes there must be a decrease in spending. The bill must include how and where the increase in taxes must go, such as its only use is to pay down the national debt. That is what I would do with my finances. If my debt was very high I would not look for less income, a lower paying job. But if I could bring in more income, I wouldn't go out and buy a 60 inch TV. The wise thing is to start showing some discipline. Not reducing spending in a reasonable and compassionate way and increasing taxes with the new money earmarked for debt reduction is admitting defeat.

 

[PureX]

When we cut spending on social programs, people suffer and die. When we increase taxes on income, no one suffers and no one dies. Since this giant increase in our debt was caused by the the greed of the wealthy and their cronies in politics having gotten way out of hand (the invasion of Iraq, the swindle on Wall Street, and the bank bail out) it seems only fair that the people who caused the debt should be the people who pay for it.

The general public has some blame, as we allowed it to happen, but we are already paying hard for our part in all this greed-run-amok. So now it's time for the real perpetrators to pay for the damage they've done.

But this isn't going to happen because they still have control of the government, and they are hard at work trying to convince the rest of us that it's somehow the fault of the evil poor. And that we should be made to pay for it all because we aren't all working hard enough. And many of us are so incredibly stupid that we actually believe them!

So we have become a parade of fools and thieves, now, intent on marching into an abyss of our own making. There are solutions, but we don't want them.

 

[Yorzhik]

Couple of problems with that. For one, we voted to raise taxes in November. It hadn't happened at this point. Also, the 10.8% shortfall was versus a projection of expected revenue with stable tax rates, not based on a change in rates. So, it doesn't support the Laffer Curve.

No, the shortfall was what the budget was based on. And the vote in Nov. is bringing taxes based on the same static model. It is saying in the same way, "This hose ran too slow and didn't fill the tank the way we expected. We will now try to fill a bigger tank using the same hose."

w/rt Texas: Something else that doesn't support the Laffer Curve: Increases in tax revenue due to an energy boom.

Au contraire. When people have money to invest and no regulation in their way they are able to wind up the economy's engine. Imagine if they had the same barriers to fracking that Vermont has?

The Laffer Curve affects everything, some directly and some indirectly, and some in smaller ways and other in bigger ways. They way to maximize investment by the private sector and have the highest revenue for government is a flat tax according to the Laffer Curve.

Thus, CA is in trouble with higher taxes, and TX would be wise to cut spending, and cut/flatten the tax rates to do even better than they are.

You have to admit, raising rates does not always mean more revenue, and specifically in this case CA will end up shorter than they based their budget on.

 

[Traditio]

When we cut spending on social programs, people suffer and die.

Not all programs are "social" in the sense of providing for those who otherwise wouldn't be able to provide for themselves. There probably is some room to cut spending (getting rid of duplicate government programs that are basically doing the same thing, for example). On TV the other day, there was a news station that was reporting on the apparently exhorbitant government waste. Apparently, there's this one airport that has like one flight a year. It gets kept open so that the state can keep getting a government handout. It got x number of dollars to fix the lights...the airport didn't even have electricity!

The so called "bridge to nowhere" is another good example of this point.

The general public has some blame, as we allowed it to happen.

The general public has the vast majority of the blame. Democracy is irredeemably flawed.

"Until philosophers rule as kings or those who are now called kings and leading men genuinely and adequately philosophise, that is, until political power and philosophy entirely coincide, while the many natures who at present pursue either one exclusively are forcibly prevented from doing so, cities will have no rest from evils...nor, I think, will the human race" (Republic 473c-d).

 

[genuineoriginal]

Democracy is irredeemably flawed.

That is why the founding founders set up the United States as a Republic and guaranteed that all States admitted into the Union would also have a Republican government.

The United States shall guarantee to every State in this Union a Republican Form of Government...

United States Constitution, Article IV

 

[Traditio]

What in the hell do you think justice stands for?

Aristotle says that justice is that according to which we render to each according to what is due to him.

What crime would the younger have committed to pay for the older? How absurd of you. Justice he says.....

There is a sense in which justice comes into play in the punishment of crimes, in the sense that the criminal fails to render what is due, and, in virtue of this, he incurs a debt of justice. Something becomes due to him because of the commission of his crime, namely, punishment.

I think that the modern notion of "right" should be replaced with a more classical notion of "ius" in the sense of "what is due." According to one article that I read, the Romans conceived of "ius" in a broader sense. The person who murdered his parent(s) had a right (ius)...to be tied up in a sack full of vipers and thrown into the river Tiber.

But criminal law, I think, presupposes a much broader sense of "right" which is more primordial. There are things which are due to the citizens either to be done or not to be done. And when we do the opposite, we act contrary to justice, contrary to right (ius). And this is why we incur a debt of punishment, to balance the scales of justice which have been tipped by the crime.

Justice is, first and foremost, as Aristotle says, a "making equal." Not numerically equal, of course, but proportionately so.

So I think that your conception of justice is too narrow, and I don't think that Moses conceived of it that way. Again, the Law demands a tithe to be paid for the poor, the widow, the stranger, etc. I think that this falls under the notion of "justice" in the sense of "what is due."

It is worth noting that the Catechism of the Catholic Church states:

"It is unjust not to pay the social security contributions required by legitimate authority" (CCC 2436).

Furthermore: "Love for the poor is incompatible with immoderate love of riches or their selfish use:

Come now, you rich, weep and howl for the miseries that are coming upon you. Your riches have rotted and your garments are moth-eaten. Your gold and silver have rusted, and their rust will be evidence against you and will eat your flesh like fire. You have laid up treasure for the last days. Behold, the wages of the laborers who mowed your fields, which you kept back by fraud, cry out; and the cries of the harvesters have reached the ears of the Lord of hosts. You have lived on the earth in luxury and in pleasure; you have fattened your hearts in a day of slaughter. You have condemned, you have killed the righteous man; he does not resist you.

St. John Chrysostom vigorously recalls this: "Not to enable the poor to share in our goods is to steal from them and deprive them of life. The goods we possess are not ours, but theirs."239 "The demands of justice must be satisfied first of all; that which is already due in justice is not to be offered as a gift of charity.

When we attend to the needs of those in want, we give them what is theirs, not ours. More than performing works of mercy, we are paying a debt of justice" (CCC 2445-2446).

 

[Traditio]

That is why the founding founders set up the United States as a Republic and guaranteed that all States admitted into the Union would also have a Republican government.

​

A Republic really isn't that much better. :idunno:

 

[HisServant]

Id suggest little bit of both, three things can get you out of deficit

• higher tax
• less spending
• real growth in economy

I don't really think anyone is viable on its own, long term you need to spend less, but to do what the current UK government has done in cutting spending hard has hurt growth hard and pushed us further behind in deficit reduction plans.

I would say that freezing spending and growing the economy is the only practical way. Our economy is based mostly on consumerism and the more money we take out of peoples pockets, the more we slow economic growth.

 

[PureX]

Not all programs are "social" in the sense of providing for those who otherwise wouldn't be able to provide for themselves. There probably is some room to cut spending (getting rid of duplicate government programs that are basically doing the same thing, for example). On TV the other day, there was a news station that was reporting on the apparently exhorbitant government waste. Apparently, there's this one airport that has like one flight a year. It gets kept open so that the state can keep getting a government handout. It got x number of dollars to fix the lights...the airport didn't even have electricity!

The so called "bridge to nowhere" is another good example of this point.

These do happen, and they certainly should be addressed. But the truth is that they don't add up to all that much expense in the overall picture. But they make really good "hot buttons" stories for stirring up animosity and resentments that can be used to effectively obscure where the real money went, and why we are really in debt.

The general public has the vast majority of the blame. Democracy is irredeemably flawed.

"Until philosophers rule as kings or those who are now called kings and leading men genuinely and adequately philosophise, that is, until political power and philosophy entirely coincide, while the many natures who at present pursue either one exclusively are forcibly prevented from doing so, cities will have no rest from evils...nor, I think, will the human race" (Republic 473c-d).

Well, as you know, we are not a democracy, and never have been. We are a democratic republic based on a set of principals that both the weak and powerful must adhere to.

The real flaw in our system (in the United States) is that the wonderful men who set up this new form of government were doing it for the first time, and so didn't do as good a job as we would have hoped. The principals they laid out had the right idea, but were not clearly articulated enough and thorough enough so as to preclude most of the inevitable attempts at circumventing. And then 'we the people' did not do our part in maintaining those principals and expanding on them as we should have. And I think it would be impossible, now, to add in the necessary corrections as the forces of abuse have grown far too powerful.

 

[Traditio]

These do happen, and they certainly should be addressed. But the truth is that they don't add up to all that much expense in the overall picture. But they make really good "hot buttons" stories for stirring up animosity and resentments that can be used to effectively obscure where the real money went, and why we are really in debt.

The "real money" goes to entitlement programs and the military. So far as I'm aware, that makes up roughly 3/4s of the federal budget. A substantial portion goes to paying off interest on debt. (To my mind, the notion of government debt is ridiculous.)

In any case, as I indicated in the thread, I don't think the answer is just cutting spending. I think that there's only so much room to cut spending (though there is at least some room to do so, especially when it comes to cutting government waste).

Well, as you know, we are not a democracy, and never have been.

It's just a bad.

I have a query for you, PureX: Why do you suppose that most Americans detest congress, but the same guys tend to keep getting elected over and over again?

 

[Traditio]

You appeared to be making the argument that that which is in the interest of the state should be funded by the state.

Sort of. Something should be funded by the State if 1. that which is to be funded is in the interest of the State (what chiefly concern the State are matters of justice) and 2. it is in the interest of the State to fund it.

I grant that making sure that everybody being fed and housed is in the interest of the State. I'm not sure that it's in the interest of the State to fund everyone's food and housing. What would that look like? I give x amount of money to the State in taxes, and then the State gives me y amount of money every month?

That seems like a really backward way to do things. It would be incredibly inefficient, to start off with. You'd have to pay people to figure out how much to tax everyone, how much to pay everyone, to send off the checks (or debit cards, or whatever the means of payment may be), etc.

Sheerly in terms of practicality, it just seems more practical to let people buy their own food and obtain their own housing, and simply provide government aid when people are not able to obtain these things on their own.

But there is a disproportion in this case to medicine. By and large, people don't pay the full cost of health care every time they go to the doctor. They go through health insurance agencies.

Catholics believe in a principle called "subsidiarity." The principle basically, as I understand it, is that if something can be handled effectively without state intervention, it should be handled at the lowest level possible (at the level of the family, for example).

A better question would be, what kind of an education should the state provide? Should it pay for my child to go to Harvard or Cornell if they are capable of succeeding in those environments? If not, why not?

I was referring more to education up to and including high school. College should probably be funded. To what extent, though? I'm not sure.

There's no reason for the average person in this day and age to require a doctor to figure out what is necessary to be healthy.

Eat healthy, get plenty of fresh air and exercise.

Cancer? AIDS? Diabetes? Bacterial infections?

 

[Lighthouse]

This is what the money apparently is being spent on.

If you want to say "spending cuts," then explain to me where spending should be cut.

The biggest costs are medicare, social security and the military.

On ethical grounds, I don't think that it's OK to cut medicare and social security. The people who are receiving social security and medicare paid into it. People are presently paying into it. Furthermore, the elderly have a just claim to it. The elderly are less able to work, and frankly, employers tend not to want to hire them anyways. This is just a brute fact of life. Old people are less likely to get hired.

Not to mention the various maladies that afflict the eldery...memory problems, back problems, arthritis...it's just not fair to expect them to work. They've paid their dues. As a nation, we should all be OK with letting Grandma and Grandpa enjoy their golden years without having to work until they drop.

So, as far as I am concerned, medicare and social security are off the table. The Republicans, of course, beg to differ. But I think that the Republicans are morally bankrupt in this respect.

Right; because setting aside your own money for your own retirement during the years you are still working is out of the question.

Well, OK. The other big ticket item is the military. The Republicans are adamant about not cutting that.

Ok. So the Democrats (and anyone of any moral decency) don't want to cut entitlement programs. The Republicans don't want to cut the military.

So now it's just a matter of cutting nickles and dimes here and there, isn't it?

But wait! I do see what's becoming a larger and larger piece of the pie. Presently, we spend 7% of the budget a year on INTEREST payments on the debt. Seven percent. About 248 billion dollars this year. And it's only going to get bigger.

You want to cut spending? Well, that seems like a good place to cut. That's money that we're just throwing away.

But the only way to cut spending in this area is to pay off the debt.

There's really no way around it. Revenues have to be increased, at least until the debt is paid off.

I think I'm just going to leave it alone; there's no reasoning with you; you can't see past the end of your nose.

 

[oatmeal]

Cut spending by about 3/4

God is wise and reliable.

People, politicians included, are not.

oatmeal

 

[PureX]

The "real money" goes to entitlement programs and the military. So far as I'm aware, that makes up roughly 3/4s of the federal budget.

It isn't the federal budget that got us so far into debt. It's the insane cost of health care, the Iraq war, the Wall Street bail-out, and the Wall Street con-game that crashed the economy. The only reason the media and the politicians are all blaming it on the federal budget, and especially on "entitlements", is because they don't want us to place the blame where it really belongs: on the people who have pocketed all those billions and billions of dollars.

A substantial portion goes to paying off interest on debt. (To my mind, the notion of government debt is ridiculous.)

I agree. But the public is far too ignorant to understand why this is so. So there is very little hope of changing that.

In any case, as I indicated in the thread, I don't think the answer is just cutting spending. I think that there's only so much room to cut spending (though there is at least some room to do so, especially when it comes to cutting government waste).

We shouldn't cut spending at all. We should spend better, and smarter. Government spending is the only thing that get's the wealth of the nation back into the hands of the people who will actually buy things with it. They keep the money moving around, which is vital. In fact, we need to get the huge piles of money out of the hands of the few people who now control it, and who do nothing with it but pervert government, manipulate and exploit markets, and stockpile it out of the country, and then spend it back into the hands of people who will start new businesses, and buy products and services, and pay off loans with it.

I have a query for you, PureX: Why do you suppose that most Americans detest congress, but the same guys tend to keep getting elected over and over again?

There are a lot of reasons. One is that the politicians have been stacking the electoral rules in favor of incumbents for decades. It takes a lot of money and political "juice" to beat an incumbent these days. Another is that people are generally idiots, who choose their candidates for idiotic reasons that have nothing to do with their actual behavior as elected officials. And another is that the politicians are effective liars. And we tend to like to lie to ourselves, through them. And the media is little or no help at all, in that they only want to cover scandals and political infighting because that's "sensational", and they know we'll watch that. They won't spend any time or money actually trying to find out and show us what's really going on. And even if they did, most of us wouldn't bother to watch it, hear it, or read it, anyway.

 

[Traditio]

Right; because setting aside your own money for your own retirement during the years you are still working is out of the question.

Four points:

1. The people who are presently on it have paid into it their entire lives. Cutting it would be unjust to them.

2. There are many who have paid into social security who are not yet on it. Cutting it would be unjust to them.

3. If the above alone were a viable, realistic option that people reliably could be expected to use, then social security would never have been instituted, because there would have been no need for it. Fact is, there are several reasons why this is unworkable.

A. Investments can be risky. This was demonstrated in the 2008 stock market crash.

B. Many cannot be expected to save substantial amounts for retirement either because of a. lack of means or b. because of their own irresponsibility.

There are likely other reasons.

4. Social security payments are not inconsistent with saving money on your own. My grandparents did just this. Many older people draw both on social security payments as well as their own investments/savings.

I think I'm just going to leave it alone; there's no reasoning with you; you can't see past the end of your nose.

Yes. Of all the posters here, there's no reasoning with me. I mean, sure, I've spent several years of study on reasoning properly, but no, there's absolutely no reasoning with me. Somehow, all of that study was just plain lost on me. lain: