"Lower tax rates" was the policy that got US in trouble during the Bush era, and why continue such policies?
See my comments within the paragraphs.
http://online.wsj.com/article/SB10000872396390443995604578003861814796262.html?mod=googlenews_wsj
The Romney Cure for Obama-Induced Economic Ills
Lower tax rates provide incentives for more investment and hiring, especially by small-business owners.
By JOHN B. TAYLOR
When my economics students ask me how Mitt Romney's program will improve the economy, I begin by stressing the basic problems and then address the usual counterpoints.First is the obvious: The American economy is getting worse, not better. Real personal income fell by 3.8% at an annual rate in August. In the past two months, half a million Americans gave up looking for work, and the percentage of the working-age population with jobs is below, rather than above, what it was when the recovery began in July 2009. Unemployment has been stuck above 8%. Economic growth in the most recently reported second quarter was a minuscule 1.3%.
The Obama administration and its supporters counter with a rosier view, noting that, according to a Bureau of Labor Statistics survey of households, there are 2.3 million more jobs in the past 12 months. That may sound good, but over the same period the working-age population increased by four million. And in the past two months, the survey shows, employment declined.
>Othman
As bad as it may seem, it was not as bad during the Bush era. After such devastating damage done to the economy, that lower taxes HAD FAILED to address, you still want to propose similar failed policies?
And worse, these same policies are still being carried out by the stubborn Republican congress, that continue the Bush era income tax cuts across the board, and therefore favoring the rich much more.
And yet put the blame on Obama!!! Bloody lying idiot.
If the Republican Congress had allowed Obama's plans to proceed, we are sure US economy will grow even larger and there will be much less unemployment, and all economist with a decent honesty will surely know this.
Now, the Bush tax cuts is still on, why isn't the economy recovering? Why blame it on Obama?
The excessive tax cuts on the rich is the main problem, US citizens must wake up. If tax cuts really can introduce more jobs, by this time, unemployment rates should have gone down.
Facts don't lie, but we can reason it by observing that despite tax cuts on the rich, the rich are not investing. Why? Becaasue the economy is weak, because the consumers are still poor. The consumers are mostly the middle-class. Without the economic strength of the middle-class, there will be negligible consumption in the US that drive its economy, and therefore investment. Even Apple does not invest heavily.
No matter how much you reduce its taxes, it will not invest more in US. Better face the reality. Better tax Apple more, so that Apple will maintain its HQ in US because most consumers are in US. If you still dont' know the simple maths, how many iPhones can someone with 1 million buy? 1. How about those with 100,000, ten of them. The chance for those with incomes of 100,000 to buy is ten times more than those with 1 million income. Imagine against billionaires? That Bush era tax cuts favour.
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The second basic problem is that the economic policies pursued by the Obama administration consist mainly of short-term interventions, such as the stimulus packages, cash-for-clunkers, and temporary payments to state governments and individuals. At best, these have produced only small, short-term economic blips.
Here, too, some administration defenders claim that at least the fiscal stimulus packages stopped the economic free fall. This is not what the data show. The American Recovery and Reinvestment Act was enacted in February 2009, but the sharp decline in retail sales, exports and new investment orders ended in December 2008 or January 2009.
>Othman
That act was not the only action taken by the Bush adminstation to halt the decline. Bank bailouts were much earlier.
Are you saying that the act didn't stop the decline AT ALL? Just the discussion of the act can stop steep declines. Without any discussiion of a reinvestment, it will surely freefall. A professor in economics should know this and yet, failed to see investor sentiments.
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Basic economics tells us that such temporary policies do little to restart growth. More lasting reforms are needed. Mr. Romney's economic plan will deliver these reforms. It promotes growth by focusing
>Othman
Yes. Not by continuing Bush tax cuts for the RICH!!! See the words clearly!!! THE RICH!!!
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on five strategic areas: energy, education, trade, debt reduction and job creation.
>Othman
All a bunch of lies and half measures that had already been tried during Bush era and failed.
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Economists point to enormous opportunities for sustainable growth in energy. To capitalize on these opportunities, the federal government has to approve the necessary infrastructure—such as the Keystone XL pipeline—and permit states to manage energy development on federal lands within their borders. The Romney plan would provide the needed federal approvals.
>Othman
Without taking into account the environmental impacts, it will make it worse in the long run to the US economy. Similar to the devastation done to East Germany, vs West Germany.
Environmental disregard, for the sake of short term economic gains will not help the nation in the long run.
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The nation's troubled education system is a drag on long-term growth. To improve outcomes, Mr. Romney proposes to allow students in poorly performing schools to use existing federal funds (such as those in Title I, which are targeted to disadvantaged children and high-poverty districts) to attend other public schools including charters, private schools if their state allows it, and online-education programs. Research by economist Eric Hanushek shows that bringing U.S. education back to the top of international rankings would substantially increase GDP and eventually increase average incomes by 20%.
>Othman
When you continue giving money to the rich, but giving them tax cuts, where do the money come from? From the air???
The students need to be given a chance to succeed, not to be ridiculed as parasites to the nation because they don't pay any tax. When their time had come, they should then pay their fair share of the tax. Without any tax, or very very low tax, where do the money to help students and unfortunate people can come from???
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A more aggressive program for negotiating trade agreements to open markets for U.S. goods and reduce costs for American producers and consumers will raise real income. The current administration has not started and brought to completion even one trade agreement. Mr. Romney intends to move ahead on trade agreements and create global enterprise zones to remove barriers to trade.
>Othman
If Bush failed to do it in 8 years, what makes you think Romney and Obama can do it?
The best that you can do is to stop US companies from investing in China or overseas, by taxing them heavily. After all, these companies still need US consumers for their well-being. Obama is on the right track. Romeny and Bush had made things worse by encouraging companies to invest overseas in order to maximise profits, in the name of reducing costs.
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The federal debt is exploding. With the administration's policy, the Congressional Budget Office projects a debt-to-GDP ratio of 80% in two years, double the amount at the end of 2008. This policy is slowing economic growth by raising the likelihood of large future tax increases or another financial crisis. Mr. Romney puts a high priority on bringing the debt down as a share of GDP. Specifically, his plan is to reduce deficits by gradually bringing down spending as a share of GDP to 20% by 2016, which is where it was before the crisis in 2007. This reduction in federal spending is what any
>Othman
By not reducing taxes to the rich, you pretend to reduce the US debt? Just a lie.
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responsible family or business would do if they were borrowing at an unsustainable pace.
Mr. Romney's tax reforms are designed to foster more investment and jobs. For example, his proposal to lower marginal income-tax rates across the board by 20% will provide incentives for small businesses to expand and increase their hiring. Cutting the corporate-tax rate from to 25% from 35% and insisting on a cost-benefit approach to regulation—both part of the Romney plan—will enable American firms to be more competitive in the global market.
>Othman
Where do the money for education that was mentioned earlier, could come from then?
What is not mentioned is the intention of Romnet to contine spending for Defense.
What about health care? Are you going to cut some more? Why no mention about this?
If you don't cut benefits, while reducing taxes, you will increase US debt even more, simple arithmetic, that primary school students should now. No need to be a professor to calculate this, just plain honesty.
If you cut benefits, who will suffer the most? The middle-income of course. To the rich, it is nothing to them. By lowering the standard of living of the middle-income, you will devastate the consumer economy of the US, reducing profits for the rich, discouraging new investiments because of low profit margins etc.
The same Bush illnesses repeated all over again.
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In response, former President Bill Clinton said at the Democratic National Convention that Mr. Romney would return to "the same old policies that got us in trouble in the first place." No, the Romney plan rejects such policies, including perpetual support of poorly regulated housing-finance agencies, such as Fannie Mae and Freddie Mac, which got us into the mess. Mr. Romney also argues
>Othman
You forgot conveniently to mention about the poor regulation, during the Bush era, and Mr. Romney has no mention about improving regulation, rather reducing regulation even further, thus making cases like Fannie Mae even more likely in the future.
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against the easy-money policy by the Federal Reserve that helped lead to the crisis.
Critics complain that Mr. Romney's tax proposals favor the rich. Actually, he wants to eliminate or limit deductions from special provisions in the tax code for high-income Americans in exchange for lower marginal tax rates. We have not had a major tax reform since 1986, and the tax code has become notoriously cumbersome and a drag on growth.
>Othman
Show to the public what the plans and reforms are! There is none at the moment. Reform that works anyway. You can talk about your attempts all years, but what matters is that it cannot be achieved all these years. What makes you think Romney is so special? All over the years and world, people try to make such reforms, but instead of reducing the problems, they make the problems worse. E.g. the US tax system of course. The rich always can find excuses not to pay any tax at all.
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His plan does not, as Mr. Clinton claimed at the convention, "get rid of those pesky financial regulations designed to prevent another crash and prohibit future bailouts." Rather, the plan bolsters capital requirements, repeals debilitating regulations in Dodd-Frank that had nothing to do with the crisis, and follows the rule of law, including the bankruptcy code, without giving favors to special interests. It thereby avoids both crises and bailouts—and puts the country on a sound path toward sustainable prosperity.
>Othman
You should tell that to Mr. Bush. He bailed out banks. All these provisions had failed to stop the financial disaster, what makes you think your version will? Rule of law exists all the time, and yet bank failures still exist. What rule of law alone can prevent a financial disaster? None. So why propose one. Rule of law, if not backed by regulations, will be too late.
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Mr. Taylor is professor of economics at Stanford and a senior fellow at Stanford University's Hoover Institution. He is an economic adviser to the Romney presidential campaign.
>Othman
When someone is too tied to party politics, they tend to be biased. We can expect some bias, but to tell only half truths, is unacademic and unprofessional.
