…consult a recent study by Eric Toder, Jim Nunns and Joseph Rosenberg of the Tax Policy Center. We know this Brookings-Urban Institute shop has credibility with liberals, because it is the source of the fiction that the Romney-Ryan team wants to boost middle-class taxes.
The researchers looked at how high income-tax rates would have to rise in the top two or even three tax brackets to lower debt to sustainable levels under something akin to CBO’s alternative fiscal scenario. They conclude that even if the top rates hit 100%, the budget “cannot achieve the debt-reduction targets in some or any of the target years.” Though conceding that near-total confiscation is “completely unrealistic,” they report the results anyway “to indicate the infeasibility of achieving a high debt-reduction target simply by increasing top individual income tax rates.” And this is from economists who favor higher taxes.
Another way of putting it is that the rich aren’t nearly rich enough to finance Mr. Obama’s spending ambitions. Sooner rather than later, Washington will come for the middle class, because that’s where the real money is.
100% tax on rich would not pay for Obama’s spending
Please share widely!
Mr. Lynne says
… and substantive analyses and criticisms that can be made for Obama’s budget, but (as usual) I have a hard time taking the WSJ opinion page seriously. First of all, they read minds:
Up – the ‘secret VAT’ plan. Sure. Whatever.
Then I went looking for the TPC center study they referred to in order to figure out if they were saying what the WSJ says they were saying (Romney has had this problem of putting words in economists’ mouths). But of course they provided no links. Thankfully my google-fu is strong.
Mr. Lynne says
Ugh. Incomplete post. Will finish later.
danfromwaltham says
Would only fund the government for six days. Yet, the Dems say this will cure all.
Ryan says
What a slimy, hateful thing to say.
Christopher says
…on those who work for their pay and create jobs with their demand, and for all people up to that threshhold. He wants to raise them above the amount that income is no longer all that stimulative. It’s a start, but right now we need to spend till we’re blue in the face a la New Deal.
danfromwaltham says
are 58% of the new jobs are low paying, under $14.00 an hour. So if we run $12 Trillion deficit over the next four years, will we get better results?
merrimackguy says
First- this is not an business cycle problem (if it was we would have worked it out by now). It’s a structural problem driven by debt at all levels. Where you don’t have as much debt (like your town) you’ve got contributions towards unfunded liabilities eating into operating budgets.
Second- Structural problems are being compounded by the long downward trend that started sometime in the 70’s. The trend (where wages were not rising) we tried to counter by adding wives to the workforce, constant government stimulus, bubbles of all sorts and then the massive borrowing. Now we’re just further down the road.
Thirdly Government spending (and add not just current spending, but at the state and local level you need to add the increases in debt) is growing rapidly due to things out of their control like increased health costs and the demographics of people living longer.
No one talks about it because the general population doesn’t understand it and the political class knows it’s toxic to re-election.
The private sector isn’t dynamic enough to support our public sector or the entitlement system. That’s why public employees and entitlements are under attack. There are inequities in the private sector. Some people are getting rich without what is perceived to be the requisite work and risk. As seascraper points out, taxing those people (and everyone else with a lot of dough) will not be enough to change the trend.
So we need not just change but dramatic change on the spending side.
We also need to revitalize the private sector.
I have something I think is the answer, but I’ll save that for an on-topic thread.
seascraper says
Christopher, most of the upper income bracket are pass-through entities, that is, businesses which pass their income through a personal return so they don’t file a corporate return.
Most of the upper income bracket filers are businesses.
SomervilleTom says
Your comment is self-contradictory.
Businesses pass through their income to persons. Those personal returns that you correctly describe are for individuals, not businesses. The business (such as an LLC, LLP, or S-corp) files an 1120 and issues a K1 for each member/shareholder, and the K1 income/loss is then reported on page 1 of a personal 1040.
Most of the upper-income bracket filers are individuals, and high-income individuals at that.
johnd says
I didn’t watch the speeches last night but did they mention the US just passed $16 TRILLION for our National Debt? Has the CBO stuck their finger in the air to guess what the national debt will be in 10 years according to the Obama budget plan… by $6.7 TRILLION. How the F are we going to pay off that National Debt. Does ANYONE have any ideas besides “inflation”? Does anyone have any ideas on how we will even make annual payments on the almost $20 TRILLION debt?
I’m open to ideas but could anyone please give me a plausible idea, complete with a little math to show how this gets addressed?
kbusch says
unlike the word “God” in some Bibles does not have to be spelled entirely in upper case.
johnd says
Trillion…
kbusch says
If you look at growth in GDP — Google now gives you nice graphs if you ask for them, you’ll see that what would have been a large debt in our 1960’s economy rapidly gets dwarfed by GDP growth.
Payments on our debt are now subject to very low interest. It is the absolute best time to borrow. This is especially true given the degraded state of our infrastructure. If we’re going to be competing with China, we don’t want to do with a Somalia-style infrastructure.
kbusch says
Answer is: we never do. No modern capitalist country has ever paid off all its debt.
HR's Kevin says
The WSJ opinion pages are so full of false information and illogic most days that it is not worth spending time trying to refute them.
merrimackguy says
I have read the Atlantic for years (like 30) and I always though they were even handed, but people here criticized a post citing it because they didn’t like the writer, and my conservative friends just assume it’s slanted to the left.
Many people on BMG criticize the Globe, and of course the Herald’s out. Don’t even mention my local paper the Eagle Tribune.
Maybe we should stop using citations. That’s very popular these days.
HR's Kevin says
However, with the exception a few writers with stellar credentials (like Krugman) I don’t put much stock in any opinion piece as evidence for an economic policy. And the WSJ has an absolutely horrible record with manufacturing facts in its editorial pages. It does not even remotely resemble real reporting.
In any case, no one who wants to be taken seriously on this site shouldn’t be using the WSJ editorial page material as evidence.
merrimackguy says
all economists are just guessing. You can cite any number of them to support either side of any issue.
Charley on the MTA says
You might wanna punch him in the mouth. And maybe I might too. But the guy has been right about a lot of things. He was getting pilloried for “predicting 9 out of the last none recessions” as late as 2008 (after we actually had been in recession) … but he nailed it not just on that it would happen but precisely why.
Yeah, he’s shrill, and possibly unduly pessimistic at times. But he called the big one — and wasn’t the only one by any stretch, btw. He’s also got a Nobel.
Go ahead and drink the Haterade. But don’t dismiss him.