Welcome to PatsFans.com

Should our current economic system change?

Discussion in 'Political Discussion' started by Turd Furguson, Oct 12, 2007.

  1. Turd Furguson

    Turd Furguson Rookie

    Joined:
    Nov 22, 2004
    Messages:
    1,245
    Likes Received:
    0
    Ratings:
    +0 / 0 / -0

    Would you prefer the U.S become a Socialist or Communist economy? Or do you believe that Capitalism is key in the American dream?
  2. Patters

    Patters Moderator Staff Member PatsFans.com Supporter

    Joined:
    Sep 13, 2004
    Messages:
    17,253
    Likes Received:
    21
    Ratings:
    +23 / 0 / -0

    We're more or less in the European model, with programs like Social Security, Aid to Dependent Children, Medicare/Medicaid. Basically, we should continue to tweak the system so that it helps the truly needy and develops our economy. In that sense, I favor social democratic economies, like those of France, Sweden, Norway, etc. But, one area I do think we need to be more capitalistic on is taxes. Tax rates should be driven by supply and demand. We should raise taxes on the wealthy when we need more money, and cut those taxes at the point where it begins to harm our economy. I don't like communistic flat rates, where everyone pays the same percent. I prefer more capitalistic taxes, driven and shaped by the dynamics of the economy.
  3. Real World

    Real World Rookie

    Joined:
    Aug 15, 2006
    Messages:
    26,287
    Likes Received:
    24
    Ratings:
    +26 / 0 / -1

    The freer the market, the more opportunity there is for everyone. If you want everyone to be a number, and earn similarly, then the other two are right for you. No thanks.
  4. Real World

    Real World Rookie

    Joined:
    Aug 15, 2006
    Messages:
    26,287
    Likes Received:
    24
    Ratings:
    +26 / 0 / -1

    Higher taxation on the wealthy slows growth. Higher taxation of any kind slows growth.
  5. Patters

    Patters Moderator Staff Member PatsFans.com Supporter

    Joined:
    Sep 13, 2004
    Messages:
    17,253
    Likes Received:
    21
    Ratings:
    +23 / 0 / -0

    Prove it! (Where did you get that from, some partisan playbook, or share with us the economic reports that you read, since you claim to know so much.)

    There are too many variables in economic growth to attribute that growth to tax cuts. In fact, there's evidence that high taxes spurred economic growth in the past:

    http://www.huppi.com/kangaroo/L-taxgrowth.htm

    "There is no historical evidence that tax cuts spur economic growth. The highest period of growth in U.S. history (1933-1973) also saw its highest tax rates on the rich: 70 to 91 percent."
  6. Real World

    Real World Rookie

    Joined:
    Aug 15, 2006
    Messages:
    26,287
    Likes Received:
    24
    Ratings:
    +26 / 0 / -1

    Um, look inside that period you mention and tell me when we experienced the highest level of growth? Hmmm...When you do that, consider what years that growth was experienced, and what Kennedy did during his term to accomplish those gains. :p He slashed taxes, especially the marginal rate for the highest earners. This was on Kudlow the other night. He slashed them from 90% to 71%. What was the result of his tax cuts? Yup! Economic growth, increased revenue for the government, and a decrease in the deficit. :rocker:

    BTW, what did Reagan do? The Economic Recovery Tax Act of 1981. How'd that work out for ya?
  7. BelichickFan

    BelichickFan B.O. = Fugazi PatsFans.com Supporter

    Joined:
    Sep 13, 2004
    Messages:
    31,088
    Likes Received:
    29
    Ratings:
    +37 / 2 / -3

    #24 Jersey

    I wonder if that number seems to high for Patters . . .

    :bricks:
  8. Patters

    Patters Moderator Staff Member PatsFans.com Supporter

    Joined:
    Sep 13, 2004
    Messages:
    17,253
    Likes Received:
    21
    Ratings:
    +23 / 0 / -0

    Yeah, but Roosevelt and Eisenhower raised taxes, and we had economic growth as well.
  9. Real World

    Real World Rookie

    Joined:
    Aug 15, 2006
    Messages:
    26,287
    Likes Received:
    24
    Ratings:
    +26 / 0 / -1

    Yeah, but....

    When did we have the highest rise in economic growth? When did we have the greatest results? It's been when rates were cut.
  10. PressCoverage

    PressCoverage Banned

    Joined:
    Sep 25, 2005
    Messages:
    8,609
    Likes Received:
    13
    Ratings:
    +13 / 0 / -0

    is anyone surprised with the case study that is original post here?

    because if we've learned anything about Conservative thought, it's either black or white... no in between... if it's not gung-ho soulless capitalism in every aspect, it must be evil communism without a doubt...
  11. Patters

    Patters Moderator Staff Member PatsFans.com Supporter

    Joined:
    Sep 13, 2004
    Messages:
    17,253
    Likes Received:
    21
    Ratings:
    +23 / 0 / -0

    Do you have a link to support that? Also, what about the effects of massive deficit spending. Let's face it, both Reagan and Bush pumped billions into our economy that we do not have. Don't you think that affects economic growth, with a price to pay in the future? All I'm saying is that tax rates are merely one factor in determining economic growth. High taxes or low, you can still have growth and prosperity.
  12. Real World

    Real World Rookie

    Joined:
    Aug 15, 2006
    Messages:
    26,287
    Likes Received:
    24
    Ratings:
    +26 / 0 / -1

    Um, yes I do have a link but it's on my internet explorer at work. Also, this wasn't about spending, it's about taxation and it's effect on the economy. If you want to argue spending, fine by me. When was the last time we had a reduction in government? Government simply grows, and grows, and grows....
  13. Patters

    Patters Moderator Staff Member PatsFans.com Supporter

    Joined:
    Sep 13, 2004
    Messages:
    17,253
    Likes Received:
    21
    Ratings:
    +23 / 0 / -0

    You can't talk about taxation in a vacuum. Clearly there are times when cutting taxes is good and times when raising them are good, but you have to factor in all sorts of other things. The correlation between tax rates and growth is not as simple as you seem to believe. Only political propaganda (on both sides) poses the issue like that.
  14. Real World

    Real World Rookie

    Joined:
    Aug 15, 2006
    Messages:
    26,287
    Likes Received:
    24
    Ratings:
    +26 / 0 / -1

    Raising taxes is NEVER good. Please tell me when raising taxes makes sense. And don't ask me a question as your answer. :p
  15. Patters

    Patters Moderator Staff Member PatsFans.com Supporter

    Joined:
    Sep 13, 2004
    Messages:
    17,253
    Likes Received:
    21
    Ratings:
    +23 / 0 / -0

    To fight WWII, to fund Medicaid/Medicare, to fund Social Security, to pay debt, etc. There are many cases where raising taxes is good, though you can debate where (state, fed, city) and how (income, capital gains, sales) taxes should be raised.
  16. Stokes

    Stokes Rookie

    Joined:
    Sep 1, 2006
    Messages:
    2,422
    Likes Received:
    1
    Ratings:
    +1 / 0 / -0

    Patters, I agree with you about continuing social programs, but I think what you say here would create a dangerous precedent. The idea of just raising taxes on the wealthy every time the country needs money is a bad idea to me. The issue that first needs to be addressed is wasteful government spending. Why continue to pour more money into a system that is operating so inefficiently? If the government is not making good use of tax dollars, the last thing we should be thinking about is giving them more money to play with! It is something that is almost never addressed when people talk about tax increases (and I mean that generally, not directed at you in particular). It always sounds great to increase taxes on cigs or booze or other things that I enjoy to fund healthcare for poor children, but if the system isn't operating efficiently it ends up being a waste, they don't get out of it what they should based on what is put in.
  17. Real World

    Real World Rookie

    Joined:
    Aug 15, 2006
    Messages:
    26,287
    Likes Received:
    24
    Ratings:
    +26 / 0 / -1

    We're talking economically. I knew you'd reach for some world altering struggle, or a disaster of some sort.

    Raising taxes for SS is a joke. They've bled SS dry for too long. It's another example of a government program being pilfered by the mentally ill, and simply passing the bill onto those, baaaaaa, sheep who bend over and pay.

    So, again, outside of the failures of government, and a world war of some kind, please tell me when it makes economic sense to increase taxes?
  18. Real World

    Real World Rookie

    Joined:
    Aug 15, 2006
    Messages:
    26,287
    Likes Received:
    24
    Ratings:
    +26 / 0 / -1

    Stokes, don't you understand buddy, we need to Save the Children! :D

    What boggles the mind is how irresponsible, illogical, and idiotic some sheep can be with respect to the government. When you get 30 or 40 cents on the dollar, why keep paying, or why even pay more? With a $2.7 Trillion budget, can someone honestly tell me the government doesn't take enough?
  19. BelichickFan

    BelichickFan B.O. = Fugazi PatsFans.com Supporter

    Joined:
    Sep 13, 2004
    Messages:
    31,088
    Likes Received:
    29
    Ratings:
    +37 / 2 / -3

    #24 Jersey

    Christ, Patters, you are daring to bring up Social Security; the single biggest fraud in the country ? Just let me keep the money and invest it for myself.
  20. Patters

    Patters Moderator Staff Member PatsFans.com Supporter

    Joined:
    Sep 13, 2004
    Messages:
    17,253
    Likes Received:
    21
    Ratings:
    +23 / 0 / -0

    I agree completely that we have to address government waste, and frankly in the '80s that was one thing the Republicans did well. That said, one person's idea of waste is another person's idea of necessity.

    A Congressperson who fights for $10 million to aid an industry in their district is often doing the right thing, but some automatically call it pork barrel. To manage the economy, farmers sometime are paid not to grow crops because otherwise prices would fall too much, putting farmers out of business. These issues are far more complex and have to do with the longterm development and viability of certain industries in certain areas during certain times.

    That said, where we can identify waste and inefficiency, let's address it. But, that issue should be separate from things that are fundamental rights, like health care. My point about taxes is that they should be dynamic and change according to the prevailing economic conditions. For instance, right now is a good time to raise taxes on the wealth and cut them for the middle class.
  21. Patters

    Patters Moderator Staff Member PatsFans.com Supporter

    Joined:
    Sep 13, 2004
    Messages:
    17,253
    Likes Received:
    21
    Ratings:
    +23 / 0 / -0

    To institute national health care, fund infrastructure repairs, improve our schools, make our neighborhoods safer by hiring more police, support developing industries such as biotech, aid our allies in times of need, address national crises like the effects of Hurricane Katrina, address health emergencies when one arises, provide aid to the truly needy, fight a war, ensure adequate care for our permanently disabled troops, improve interstate transportation which is so important to the distribution of goods, ensure clean water, provide protection against terrorism, ensure that our food standards are safe, etc. Sometimes in life your house needs more repairs than at other times, and you have to pay for it or you'll pay a heavier price later on.
  22. sdaniels7114

    sdaniels7114 Rookie

    Joined:
    Jan 2, 2006
    Messages:
    5,742
    Likes Received:
    7
    Ratings:
    +7 / 0 / -0

    What about $0.05 on the dollar? That's the rate of return one gets on gasoline. 95% of the energy tied up in gasoline goes out the tail pipe of a highly efficient car. Its more like 96% for a gas guzzler. Yet everyone still uses cars. Why? Because they're the only game in town, unless you wanna commute on a horse. Same thing with governing, there's no other way to govern a nation than by having a government.

    Besides that I find it useless to talk about government waste in the context that because individuals are more efficient with money, government should be equally as efficient. Its like saying Manny Ramirez is a crappy athlete because he's lucky to hit the ball 35% of the time, while someone like Andre Aggasi hits the ball almost every time. They're completely separate things and its useless to compare them. Like with government efficiency. The only fair comparison is between governments. I'd be right behind you if France or Australia had governments that were much less wasteful that ours; but they don't. Nobody does.
    Last edited: Oct 13, 2007
  23. BelichickFan

    BelichickFan B.O. = Fugazi PatsFans.com Supporter

    Joined:
    Sep 13, 2004
    Messages:
    31,088
    Likes Received:
    29
    Ratings:
    +37 / 2 / -3

    #24 Jersey

    No thanks.

    Which ones ? Most are state/local issues or already have taxes for them.

    Schools are fine, it's up to the kids to take advantage of it.

    State/local issue.

    Ooops - didn't see how long your list was. You get the idea :D
  24. QuiGon

    QuiGon Banned

    Joined:
    Mar 28, 2006
    Messages:
    6,123
    Likes Received:
    0
    Ratings:
    +0 / 0 / -0

    Ah yes... the old liberal waltz... I have seen it many a time - especially here in Massachusetts... Over and over, it plays out as follows:

    1) Liberals say "we need to raise taxes to repair our failing bridges" or "we need to raise taxes to improve our schools"
    2) Public says "well, we don't like high taxes but we agree this is a worthwhile expenditure"
    3) Taxes get raised
    4) Liberal bureaucracy swallows the money with payouts to union thugs, corrupt officials, more vacation time for public servants, incompetent teachers, etc, etc
    5) Years pass - Virtually nothing gets fixed or improved (in fact, the problems tend to get worse)
    6) Proceed to step (1), repeat.
    Last edited: Oct 13, 2007
  25. PatsFanInVa

    PatsFanInVa PatsFans.com Supporter PatsFans.com Supporter

    Joined:
    Mar 19, 2006
    Messages:
    19,531
    Likes Received:
    41
    Ratings:
    +43 / 0 / -2

    1. On the original premise (PCov correctly nailed the "black and white" nature of the post):

    Since we have all established that pure capitalism does not exist, in the sense of a state with no taxation or state involvement in the economy; And nobody here has argued for a state-run command economy; we can safely say that using these as the poles within which we discuss the economy, we are in a species of mixed economy, but a heavily capitalistic one, when compared with other industrialized nations.

    2. To discuss this in terms both sides can understand: we recently had a discussion on the Electoral College, in which the Federalist Papers were brought up a number of times, and the notion of a federal system was married to the notion of fighting the "Tyranny of the Majority," by the very same people who see unbridled capitalism as a simple slam-dunk solution.

    I disagree.

    Just as the Tyranny of the Majority is, in fact, a significant phenomenon to be guarded against, even as the basic underlying premise in America is "one man, one vote," Capitalism appears to be the unavoidable engine of economies the world over today. If Marx was right and there is a "next" phase, the observable evidence is heavily weighted toward the conclusion that we can not, by force of arms or innovation of government, unseat the present phase. So even if we view Capitalism as a disease, we can only treat its symptoms. To my mind, a side of human nature is the disease, and in treating its symptoms, we also treat the symptoms of capitalism.

    3. Exhibit A: If it is profitable for a company to use child labor or slave labor to make soccer balls, it is not only okay for them to do it under the dictates of corporate capitalism -- it is their responsibility to do it, assuming that shareholders are interested only in profit (per the classical model.)

    This does not go away in the absence of government intervention. The invisible hand of the market does nothing for such a state of affairs, except flip the kids an invisible bird.

    So, in the U.S., we have laws against child labor. In some of our allies' economies they do not have the same laws. The consumer gets better prices by purchasing goods from nations with weaker labor standards, if that price still beats the US price, accounting for the costs of transportation/logistics (steadily declining since the advent of freight containerizations,) and tariffs (which we are slowly dismantling in favor of a free trade environment.)

    4. Whether we "allow" it or not, by creating anti-competitive nationalistic (rather than market-driven) limitations on immigration, we have also opened the door (literally) to a free flow of labor, by dint of our obsession with free trade. It's very difficult for goods to move in bulk everywhere in the world, but to keep humans from hitching a ride, figuratively speaking (and of course that includes all the horrors of the people-traficking trade.)

    5. In short, the current cycle within our paradigm is one of global, rather than national, capitalism, with some few protections for various national citizenries, but tending toward one global standard of living, divided more by class (who you are within your society) than nationality (I'm rich by virtue of where I was born.) It's a ways off, but that is the trend (i.e., impossibly high US standard of living has fallen; some stable developing world nations' standard of living has risen; but the big difference is in how the elites fare versus the average guy or the poor.)

    6. Marx's descriptions in some cases are right on target -- but only in very broad brush ways. To the extent that capitalism is unchecked by state intervention (something introduced in any large way only in the 20th century,) wealth will always increasingly concentrate in the hands of the already-wealthy. It's the golden rule: He who has the gold, makes the rules. And of course, the rules will be that he gets more gold.

    Other limiting factors, though seemingly obvious, were not given proper weight in Marx's system. As Henry Ford first famously realized, you can't just grind the workers into pulp, because the worker, even after having met basic needs, also has to be your customer. The worker may not control the means of production, but he consumes the fruits of production, and without a worker who can do so, production goes belly-up.

    On a global scale, this has to be replicated, as the ability of the already affluent Western societies to further consume all the production of the developing societies decreases (these societies' affluence itself is decreasing.) Furthermore, as wealth concentrates, elites have more investment power, which is good for growth via investment; however, they have less need for yet another car, another refrigerator, etc. If you give a billionaire another 20 million, he isn't going to buy more durables. He will invest it. That has an obvious place in the scheme of things. But spread that 20 mill over a thousand line workers, and you've got 20,000 dollars in the hands of people who need goods. The notion that capitalism will inevitably collapse under its own topheavy weight is gainsaid by the fact that the worker has to be the consumer, and that the elites recognize this fact as well as the worker/consumers.

    Currently, globalization means that we are looked at primarily as consumers in the West. But look what's already happening in some cases: when I was growing up, there were these cheap imports called Toyotas... and Japan was, lo and behold, pulling even with the West, a miracle of post-war rebuilding! Now, the Japanese find it cheaper to use American labor than to ship the car, and they build cars here. In other cases, we find it cheaper to use English-speakers elsewhere (say, India, where English is the national language,) than English-speakers here, in customer service centers (for example.)

    All of these are features of capitalism, as it exists in the early 21st century.

    ----------------------------------------------------------------------

    Now, distilling this down to the usual drum-beat of "lower taxes!" "Higher taxes!" is somewhat limiting.

    I personally am for reductions in taxes on the worker, who, after all, consumes the goods. I am for a specific war tax, to fund any foreign adventurism, rather than a sloppy, fuzzy non-accounting given to congress every now and then, which Congress bravely passes on to future generations. You want to invade? Quantify it at least. How many people would check the box "raise my tax by $2,000 over 5 years to fund the Iraq War"? Yes, that's the amount, assuming 200 million paying some form of tax (probably overestimating the labor force,) and $450 million being the cost thus far of the war.

    Fixing Social Security is indulging in providing a "floor" standard of living for older Americans, something that, being a candidate for old age myself, I also support. I do not want the gambling of each individual to determine the income of each individual in the last few years of life; I want there to be a predetermined floor. Is that a feature of socialism? Maybe. But it's sadder to me to see an old, destitute man, than to hear that his "rights" were taken a way by a government that thinks it "knows better" -- when in fact, when you make the substitute system a reliance on gambling with winners and losers, it is predictable that this old, destitute man will exist and be replicated millions of times. This can be prevented by preserving the existing social security "floor" for older Americans. There is also a fairness aspect to it -- I am at the very end of the baby boom, or the very beginning of Generation X, depending how you count. After watching baby boomers suck up every dime of the system's solvency, am I to think the system really only applied to them and their parents? Then what the hell has MY social security tax gone to all these years? Oh that's right... you're going to let me invest it all in an iffy casino venture, most likely managed by your friends! Thanks so very much.

    Ahem. Back to the original choices:

    Do I want socialism in America? Irrelevant, and the answer is no anyway. Do I want capitalism in America?

    Well, no. I'm a bit sentimental. I prefer solutions such as national and international agreements on the type of labor used to produce sellable goods. I prefer to keep some features of a social safety net here in America (which again, might actually be better business in preserving a larger consumer class.) I could go on about this issue and that issue, all of which stray from the true Capitalism template. For example, I support the state's right to sovereignty over its borders (although I am not an immigrant-basher.) That, again, would not be a feature of true Capitalism -- where the labor would go where the job is.

    PFnV
  26. Patters

    Patters Moderator Staff Member PatsFans.com Supporter

    Joined:
    Sep 13, 2004
    Messages:
    17,253
    Likes Received:
    21
    Ratings:
    +23 / 0 / -0

    That's was an excellent, well thought out post PFnV. Sometimes I think the monarchy mentality is part of human nature. Just as in many parts of world, people intuitively protect and defend monarchies that bleed the public coffers dry so royals can live the high life, in our country people seem to intuitively the rights of the wealthy over those of the poor. If this is part of human nature, then I suppose it will never change. But, if history tells us anything, change happens. Even capitalism is not her to stay.
  27. mikey

    mikey Rookie

    Joined:
    Sep 13, 2004
    Messages:
    2,422
    Likes Received:
    3
    Ratings:
    +3 / 0 / -0

    http://clinton5.nara.gov/WH/Accomplishments/eightyears-03.html

    I believe when President Bill Clinton raised taxes on the richest 1% Americans,

    (1) GDP growth rate increases from Reagan/Bush's 2.8% to 4.0%

    (2) 23 milllion new jobs were created with 21 million in the private sector

    (3) Median income went from $42,000 to $50,000

    (4) Unemployment rate from 7% to 4%

    (5) Inflation rate from 4.7% to 2.5%

    (6) Budget went from $300 billion deficit to $250 billion surplus

    (7) Government spending went from 23% to 18%

    .
    Last edited: Oct 13, 2007
  28. Stokes

    Stokes Rookie

    Joined:
    Sep 1, 2006
    Messages:
    2,422
    Likes Received:
    1
    Ratings:
    +1 / 0 / -0


    I see your point, that no government is efficient, but instead of comparing government to government, what about comparing government to private enterprise? Companies run much more efficiently than the government, so to me it is a good idea to try and run government more like a business. Cut out positions that don't bring anything to the table (about 2/3 of the IRS for example), have real oversight rather than the "I scratch your back if you scratch mine" mentality in place today, and please please don't cut taxes and raise spending like Bush has done!

    Patters I have to disagree that we should raise taxes on the wealthy just because they can afford it. As much as it is possible, we should be cutting spending while retaining basic social programs to help the needy, and coupling that with tax cuts across the board. The wealthy already pay a hugely disproportionate percent of total taxes, I don't see why they should be forced to pay even more. I also worry about how "wealthy" is defined if we continue cycles of increasing spending and increasing taxes. Tax rates already get high pretty fast once you start making decent money, and many proposals for tax increases on the "wealthy" start at those making around $100K, not at those making $1 million plus. Who's to say that $100K lower limit won't continue to drop as the government needs more and more to sustain itself?

    One last thing, most have probably seen this already, but I like this analogy of taxes and tax cuts to a dinner bill being split by the diners. There are a lot of versions out there, this is the first one I saw:

    http://nextstoplauderdale.com/2007/04/16/the-dinner-lesson/
  29. Stokes

    Stokes Rookie

    Joined:
    Sep 1, 2006
    Messages:
    2,422
    Likes Received:
    1
    Ratings:
    +1 / 0 / -0

    mikey nice post, you show a great example why tax rates are not the sole factor in determining economic growth/health. Those gains were due to a booming tech economy weren't they? They're not the result of increasing the taxes, but they clearly show that, like Patters is alluding to I think, you CAN increase taxes in times of economic prosperity without stalling out the economy. The question still remains as to whether we should though. There is also the issue of whether tax cuts will help spur a struggling economy, I think they do but I do not have the evidence so that's just my instinctive thought and doesn't mean a whole lot.
  30. mikey

    mikey Rookie

    Joined:
    Sep 13, 2004
    Messages:
    2,422
    Likes Received:
    3
    Ratings:
    +3 / 0 / -0

    The booming tech economy occurred toward the end of the Clinton Presidency. So booming tech was not the reason for the Clinton economic miracle.

    I believe the impetus for the Clinton's economic miracle was the tax increase on the richest 1% American,

    Here is a step-by-step illustration on how the tax-increase stimulated the Clinton economy:

    (1) Tax rate increase on richest 1% Americans
    (2) Lowered projected budget deficit (because taxes increased)
    (3) Lowered projected government spending and borrowing from bond market
    (4) Lowered bond market interest rate (because lower demands for bonds)
    (5) Lowered mortgate interest (because bond yield decreased)
    (6) Stimulated home buying and mortgate borrowing (lower lower mortgage because of lower interest)
    (7) Lowered cost of capital borrowing (because lower bond yield)
    (8) Higher stock prices (because of lower cost of capital)
    (9) Increased wealth - even for richest 1% (because higher stock prices and home prices)
    (10) Increased consumer spending (lower mortgage payment and high stock prices)
    (11) Increased economic and GDP growth
    (12) Increased number of new jobs and decreased unemployment rate
    (13) Smaller government and lower spending.

    .
    Last edited: Oct 13, 2007

Share This Page