Well, mostly.
As a strong supporter of George W. Bush in 2000 and a serious fan of Mitt Romney in this cycle, let's just say I'm not terribly fond of the Granite State. At all.
Now that I've got that off my chest, let me summarize tonight's events - ably covered below on the main page by Don - like this:
WOW.
This election cycle has been filled with some amazing twists and turns: the insane earlier fundraising by Barack Obama and Hillary Clinton, Fred Thompson's elongated flirtation with the race, John McCain's massive summer swoon, a Mormon from Massachusetts making a serious run for the Republican nomination, Ron Paul's Internet minions, the Huckaboom, etc., etc. That said, Hillary Clinton's dramatic comeback might top them all.
Amidst the understandable skepticism conservatives have towards the MSM and electoral polls, the dirty little secret is that modern polling is often pretty accurate, particularly when analyzed in the aggregate rather than just trusting one poll or one pollster. It's not perfect - and better at predicting orders of finish than final numbers - but more often than not it's in the ballpark. Example: pollsters in the aggregate we're darn close with the Republican race in New Hampshire. A final poll average had John McCain over Mitt Romney by 3.6%, Mike Huckabee holding a distant third, and Rudy Giuliani just nipping Ron Paul for 4th. That almost nailed it.
Contrast that accuracy with the final Democratic average favoring Obama by 8.3% (plus this too). Oops!
The historic nature of this election with its wide-open nominations on both sides of the aisle, coupled with the obnoxiously early start, guaranteed we'd see some events that would turn into legendary political tales. It don't think it's difficult to imagine Clinton's rapid 5-day reversal from Iowa, in the face of glowing pro-Obama coverage, and an opponent in Obama who didn't actually stumble, becoming a heavily analyzed case study for campaign professionals in the future (the best very early answer on this comes from Union Leader editorial page editor Drew Cline). For now, who knows what to make of the Democratic race.
As for the Republicans, I've said it before and I'll say it again. Mike Huckabee winning Iowa and John McCain winning New Hampshire leaves mainstream conservatives without a candidate. Huckabee scares the conservative establishment, including economic and foreign policy conservatives. John McCain has spent the better part of the last decade reminding many conservatives why they neither like nor trust him. That's a big void.
Really, who are conservatives going to vote for now?
That said, it's hard to see how McCain doesn't win Michigan. The rush of "McCain is back!" media coverage after tonight is going to give him a real boost. He won in Michigan in 2000. Plus, not only is Michigan an open primary this year as it was then, but Obama and John Edwards aren't on the ballot (which in theory won't count for any Democratic delegates anyway). That leaves more independents and Democrats with motivation to play in the Republican primary, which will have real delegates up for grabs.
Of course, after Hillary's win tonight I'd rather not get ahead of myself. The only thing I'll note about post-Michigan talk is that I agree with Rich Lowry: the dynamics of how McCain and Huckabee end up engaging each other on the campaign trail as opponents will be interesting.
Final note on the GOP side in the Granite State: Giuliani did himself a lot of good by not finishing behind Ron Paul. Yes, his late-state strategy still doesn't look very good, even amidst the current chaos of the GOP field. But he avoided a very negative story line that a "he lost to Ron Paul again!" occurrence would have generated.
Almost final note of the post: I'm very interested to see the candidates' FEC reports for the 4th Quarter, due on January 15th. There was a lot of money spent in the run up to Iowa. Somebody had to be running low on cash - or at least lower than expected - by the end of the year. Who was it and how is that affecting their campaign now?
Now, I do have a favor to ask of the readers of Sound Politics. Remember in my recent Q&A where I expressed some concern about the fact I was agreeing with the herd?
Yeah.
Could you all do something for me? Next time I a) violate my rule about making predictions and b) am suckered by a rapid movement of conventional wisdom, could one of you scream at me not to do it?
Thanks.
Posted by Eric Earling at January 08, 2008 09:33 PM | Email ThisLet's not even go there.
His arrogance, willingness to bend the truth beyond all recognition and his lack of resonance with the American public make him a ticking time bomb for the Republican party.
Should the results in NH and IA be given any serious consideration?
Iowa:
Population ~3 million (ranks 30th in US)
Registered voters ~2.1 million
Caucus attendance 350K (17% of reg. voters)
New Hampshire:
Population ~1.3 million (ranks 41st in US)
Registered voters 850K
Per the Census Bureau, there were 215 million registered voters (RV) in the US in 2004. So, NH RV constitute 0.40% of US RV. And caucus results should always be taken with a grain of salt, as the caucus process is very susceptible to manipulation.
Considering the tiny fraction of US RV represented by NH and IA, why should the contests in these two states have any significance at all, much less decide who is a viable candidate going forward?
Seriously, why the rush to judgement?
Posted by: ewaggin on January 8, 2008 09:32 PMAll the negatives of democrats...why the hell bother?
Posted by: Andy on January 8, 2008 09:56 PMIs there any president in the past 40 years that would be more conservative as far as social issues (immigration would not be considered a social issue) than Huckabee?
Is there any president in the past 40 years that would be more fiscally conservative than either McCain or Giuliani?
Is there any president in the past 40 years that would be more militarily conservative than a Giuliani or McCain?
We have exceptional conservatism in the candidates we do have, they just happen to individually not be a combination of such. As such if they combine on a ticket it will be a ticket that will excite not only the individual aspects of the base, but also get some independent votes. Too bad Fred couldn't excite an 8-yr old off his Ritalin, or he could've had a chance.
Either way, it's looking up, especially with Hillary still in it. I would love for her to lose, but how about making it close so she and Obama can have time to damage each other.
Posted by: Doug on January 8, 2008 10:01 PMI understand your point to a degree but I'm not sold on the the idea of a fusion ticket mollifying conservatives.
Are there lots of conservative ideas in the field? Yes. But there isn't a candidate who makes conservatives happy.
Your rhetorical questions work to a point, but there are some tough counters to them as well, such as:
Is there a prospective GOP nominee in recent memory who scares foreign policy conservatives more than Mike Huckabee?
Is there a prospective GOP nominee who has done more in the past decade to infuriate rank-and-file conservatives than John McCain?
I still think there is a tremendous void in the field that is begging to be filled.
Lastly, I'll grant you the point that Obama and Hillary having some more time to beat each other up is not a bad thing.
Posted by: Eric Earling on January 8, 2008 10:10 PM...but back to the current year....
Posted by: Michele on January 8, 2008 10:30 PMI'd like to consider myself a mainstream conservative. As a Roman Catholic, Huckabee's bigotry against Mormonism scared me out of supporting him, fearing that he felt the same way about my faith. Giuliani is impossible to support because of his abortion position and tendencies towards corruption. Ron Paul models his foreign policy platform after Calvin Coolidge.
So really in my mind that leaves Fred Thompson, who's about as apathetic a candidate as I've ever seen, and John McCain. McCain's lack of support for the Bush tax cuts scare the living bejesus out of me... but considering everything I don't think he'd really be a bad POTUS. I might not agree with everything he says, but he comes off as someone who's honest, has integrity, and wants to do what's right. That's all I really want in a President... and the fact that he can beat Billary or B. Hussein Obama is the clincher in my mind.
Posted by: sullim4 on January 8, 2008 10:36 PMJeff, do you have a clue what "socialism" means?
I didn't think so.
Posted by: Bruce on January 8, 2008 10:42 PM"A 5th place showing in NH will probably shut me up." -Travis Pahl, 1/3/08
"Ron Paul's best state for donations per capita is NH. I think he will come in second." -Bruce Guthrie, 1/3/08
With back to back barn burning fifth place finishes, will I now be able to read blog comments in peace and quiet without the incessant interuptions of the Paultards?
Posted by: RS on January 8, 2008 11:39 PMMcCain or Huckabee will lose to either Obama or Hillary, Huckabee the worst. He's just not what we need and he's no commander in chief.
You can even disagree with Ron Paul about his approach to foreign policy, but at least he has a commanding understanding the history of US involvement abroad and can can speak intelligently and provocatively on current events.
Huckabee simply seems to have no clue and offers only coded religious rhetoric. He's a candidate that will bury the party under the weakest Democrat. I fear that he is a liability even as a a candidate for VP.
It looks like Fred's hanging on, but barely. He needs to win S. Carolina, and it's not looking good.
McCain is dangerous because, among other things, he's liberal on the worst things to be liberal on. And you can respect his support for the war, but I'm concerned he'd have little restraint and could get us into a lot of trouble, abroad and then domestically. We can't be cavalier about who, where and why we fight.
Romney seems ok but he's losing the battles he should be winning.
Guiliani's an opportunistic Democrat. Or at least not a conservative.
Hunter's great, but no one cares.
Ron Paul's ideal domestically, but the GOP won't support a candidate that breaks with Bush on the war. That would get Dems and anti-war independents to come over, but I don't think Republicans will accept that.
Obama seems to be really popular, and Hillary is so connected that we need a candidate who can compete financially and steal some Democrats without selling out our core principles. We need a new kind of Reagan.
Posted by: Pete on January 8, 2008 11:53 PMRomney.
Really, who are conservatives going to vote for now?
Romney, McCain, and Thompson. And Paul if they lean that way.
That said, it's hard to see how McCain doesn't win Michigan.
Shrug. It's pretty easy, I think. NH doesn't care what IA thinks, and MI doesn't care what NH thinks.
Posted by: pudge on January 9, 2008 12:20 AMI would agree that MI voters probably don't care much what NH voters think. But McCain has a track record in the state, it's an open primary again, and over the course of the next week McCain is almost guaranteed to receive the kind of favorable press candidates could kill for. It's possible McCain doesn't win in Michigan, but he's the clear favorite for now.
Posted by: Eric Earling on January 9, 2008 06:33 AMI get how you might be upset at McCain due to his backing the President on the immigration bill, even though none here have any good answers to the main problem area (i.e., how are you actually going to deport 12 million illegal immigrants and not negatively impact the economy). I can understand how you may not like McCain-Feingold.
What I don't get, and I heard it over and over from Sean Hannity last night, is the qualm with McCain over the Bush Tax Cuts. McCain has been clear about his stance on the tax cuts. He voted against them because there were no spending cuts to coincide with the revenue cuts. It added to the deficit. The tax cuts may have been good for the economy, but a true fiscal conservative would state that cutting taxes and reducing the size of government would be even better. Greenspan also harped on the lack of cutting of federal programs. The deficit did increase dramatically. So, for all those who call themselves conservatives and want less government, why are you so against someone who called for that? McCain's stance was tax cuts and reduce federal expenditures. How is that not being fiscally conservative?
Posted by: tc on January 9, 2008 07:27 AMSo yes, tax cuts and spending cuts is best, but voting against the tax cuts when you are unable to convince a majority to go along with spending cuts is not "fiscally conservative" and if he'd been successful in thwarting the tax cuts, would have harmed the economy.
Posted by: Bill H on January 9, 2008 08:26 AMMcCain and Giuliani are going to be monster fiscal conservatives - If one of them wins the nomination, that part of our problems will be addressed.
Posted by: Doug on January 9, 2008 08:27 AM"John McCain was one of only two Republican senators in 2001 and one of only three Republican senators in 2003 to vote against the tax cuts. Although he argues that he opposed the tax cuts because they were not accompanied by sufficient spending cuts, at the time he resorted to class-warfare demagoguery, arguing in a vein that sounded very much like Ted Kennedy that "I cannot in good conscience support a tax cut in which so many of the benefits go to the most fortunate among us at the expense of middle-class Americans who need tax relief."
"By voting against the 2001 and 2003 tax cuts, John McCain opposed the most pro-growth domestic policy in a generation and teamed up with the most left-wing senators in Congress to undermine them," said Club for Growth President Pat Toomey. "Although he claims to support making the tax cuts permanent his continued refusal to acknowledge the error of his ways casts a long shadow of doubt on the Senator's commitment to lower taxes and his appreciation for the economic prosperity the tax cuts have created in this country."
Posted by: Bill H on January 9, 2008 08:36 AMThere was McCain-Kennedy. There is global warming and every other liberal issue that he supports. McCain is a liberal.
Posted by: swatter on January 9, 2008 08:55 AMAdditionally, it is perfectly appropriate to raise the class issue specifically to Bush's cuts. Tax cuts to the middle class would have also spurred the economy. Tax cuts to the rich only made the rich wealthier and ticks off the middle class even more. Why do you think people who make under 100K are more driven to support Democrats and/or Huckabee? It is because they have been left behind in this so-called economic growth.
Posted by: tc on January 9, 2008 09:02 AMHow about a thread about how the polls are notoriously untrustworthy once again??? That is really why there are so many "twists and turns".
Posted by: pbj on January 9, 2008 09:28 AM"i.e., how are you actually going to deport 12 million illegal immigrants and not negatively impact the economy"
1) When the illegals march down the streets demanding "rights", lock'em up and ship em home.
2) Crack down on employers with a vengeance. This will cause self deportation as is happening in AZ.
http://news.yahoo.com/s/nm/20071224/us_nm/usa_immigration_selfdeport_dc
3) There will be a positive impact on the economy. Wages will rise, hospitals under seige from providing illegals with free care via the emergency room will get a break. Perhaps the ones they have already driven out of business can be brought back.
The dwindling population of illegals means a dwindling number of people that can be manipulated through fear of deportation. Less illegals selling drugs, committing crimes and prostitution.
Compromise? He was voting against his own party, his own president and his own base. I happen to think it was simply vindictive--he was pissed at Bush for knocking him out in the 2000 primaries. There is "straight talk" for you.
"so when a candidate stands by principles, he is crucified for it."
As I said, I don't think it had anything to do with "principles".
"You yourself stated that tax cuts plus spending cuts is the best method. It is really all the Republicans that voted for the tax cuts and allowed Bush to increase the size of government that weren't holding to fiscal conservative principles."
Sure, I would prefer MASSIVE spending cuts and tax cuts. But NO tax cuts as McCain's votes would have achieved, would have been fiscally IRRESPONSIBLE and led us into a recession. It is convenient to forget everything that was working against the economy in 2000-2002. We had the dot com melt down with Nasdaq in free fall starting in March of 2000, we had the corporate scandals of Enron, Worldcom, etc., we had the USS Cole blown up in 2000, the start of the 2nd intifada in the Middle East, and finally, we had 9/11/2001. Without the 2001 tax-cuts and ESPECIALLY the 2003 tax cuts, the economy would have been in seriously bad shape. Instead the economy started booming IN SPITE OF ALL OF THIS. Bush was precient in his timing of the tax cuts and should be praised for getting them in place. McCain has been rightly pilloried for opposing them.
"Additionally, it is perfectly appropriate to raise the class issue specifically to Bush's cuts."
It is the Democrats' game to play class warfare--not the Republican's. You make the perfect case as to why Republicans don't care for McCain--he acts like a Democrat.
Posted by: Bill H on January 9, 2008 10:02 AMThe poor and middle class got bigger tax cuts, percentage-wise, than did "the rich". "The rich" pay a larger share of the income tax now than they did under Clinton. The middle class does not begrudge "the rich" getting more of their own money back as long as the middle class also get more of their own money back. As I said, the Dems are the ones to wage this kind of class warfare, starting with the premise that all of the money belongs to the government and WE will decide how much of it is fair for you to "get back".
Posted by: Bill H on January 9, 2008 10:19 AMIt is like the typical line regarding the estate tax that it will effect small farmers. This is absolute hogwash. My dad was a small farmer in Wisconsin, we had 200 acres (110 tillable, 45 pasture, 45 woods). When you take into account the price of fuel and equipment, one could no longer be profitable. It was more profitable in the eighties to take the set aside money than to actually farm the land. The only small farmers still in business are dairy farmers, but only because of price supports for milk. Everything else has been taken over by big agri-business farm corporations. Even our former neighbor, who is a dairy farmer had to acquire more land just to justify the equipment costs. The 45 or so acres we sold him when we broke up the farm, only sold for around $40-50K. Therefore, even for him, who has now probably 200-300 tillable acres, his total net-worth would still be under the estate threshhold. Anyone that farms larger acres most likely forms corporations, which don't fall under the estate tax laws. So, it is complete red herring to throw out the small farmer issue with regards to the estate tax.
The middle class got a lot more of a tax cut in the 90's than the piddance Bush gave.
Posted by: tc on January 9, 2008 10:31 AMThe next President is going to have to be the one to deal with the deficit in Social Security and Medicare benefits, Rudy's ideas and Fred Thompson's are probably the best on that front.
Posted by: Doug on January 9, 2008 10:35 AM86% of ALL federal income taxes are paid by the top 25% of income earners... and that's UP from 84% in 2000.
The top 50% of earners pay 97% of all income taxes.
The top 1% pay 39% of the taxes which again is UP from the 37% from 2000 when Bush took office.
Wall Street Journal: "In 1980, when the top income tax was 70%, the richest paid only 19% of all income taxes; now, with the top rate of 35%, they pay more than double that share."
New York Times: "The top 1% of income earners paid about 36.7% of federal income taxes." The top 1% paid 36.7% of federal income taxes "and 25.3% of all federal taxes in 2004. The top 20% of income earners paid 67.1% of all federal taxes. By contrast, families in the bottom 40% of income earners, incomes below $36,300, typically paid no federal income tax and received money back from the government."
Furthermore, the INVERSE is true when it comes to government "freebies".
http://www.taxfoundation.org/files/wp1.pdf
"Overall, we find that America's lowest-earning one-fifth of households received roughly $8.21 in government spending for each dollar of taxes paid in 2004. Households with middle-incomes received $1.30 per tax dollar, and America's highest-earning households received $0.41. Government spending targeted at the lowest-earning 60 percent of U.S. households is larger than what they paid in federal, state and local taxes. In 2004, between $1.03 trillion and $1.53 trillion was redistributed downward from the two highest income quintiles to the three lowest income quintiles through government taxes and spending policy."
Grow up, stop whining and have the guts to actually say that what you want is MORE free stuff for those that don't pay anything. Stop hiding behind 'tax cuts for the rich' and be honest enough to admit you can't cut taxes that people don't PAY.
Some of his other foibles are not, such as McCain-Feingold and his poor record on gun-rights. Nonetheless, unless Fred makes a miracle comeback, in my mind McCain is it. Hopefully he would get a strong conservative as a running mate.
Posted by: russell garrard on January 9, 2008 11:27 AMAll the arguments against McCain with regards to the tax cuts fall on two avenues: (1) the tax cuts were needed due to the recession, and (2) he needed to be a good Republican and fall in line. On the first argument, a larger spur to the economy would not have been the tax cuts for the rich, but a bigger middle class tax cut or increased government spending (classic economic model -- middle class would spend the tax cut faster and thus get the money into the system, government spending always can spur economy on the short term, although has big drawbacks for the long term). On the second argument, I have already pointed out the fallacy previously when you try to use the same argument over immigration bill. The so-called good Republicans didn't get behind their President and thus we have nothing with regards to immigration reform and even more illegals are streaming across the unsecured borders. You can't have it both ways when arguing the point. Either it is right to stand out for the total package (be it tax cuts plus spending cuts, or immigration reform with no amnesty-like provisions), or it is right to get something into effect to address the immediate issue (be it a upper-class, trickle-down tax cut to supposedly spur the economy to keep it from recession, or a bill to start to secure the borders).
Posted by: tc on January 9, 2008 11:44 AMDoug, I agree with you about Fred and Rudy--they are my top two candidates. However, Fred needs to make a strong showing in SC to have any kind of chance--either needs to win or come in a strong second. I'm going to find out when he will be in Greenville or Spartanburg in the next week (he is doing a tour of SC) and hope to check him out.
I think Rudy is in fine shape right now, with 3 different people winning the first 3 caucuses/primaries, there is no clear front-runner with "the big MO".
Ragnar, thanks for all the stats. Saved me from having to respond as well.
Russell--I agree with you about deficit spending, EXCEPT that I would say that McCain would have increased deficits substantially if he had been able to thwart the tax cuts.
Posted by: Bill H on January 9, 2008 11:53 AMEverything you have said in the last two posts are the same tired arguments that liberals, Democrats and socialists always make. It comes from the point of view that all money earned belongs to the government--the government earned it and they should decide how much of it you will be allowed to keep. Libertarians and most Republicans think the money belongs to those that ACTUALLY earned it.
As to Social Security. The reason that there is a cap on contributions is that Social Security payments are only BASED on wages up to the cap. The benefit formula is also extremely skewed to lower earners. Look up Social Security bend points to learn more about this before you start trying to say high earners get a BENEFIT since they do not pay FICA above the wage limit. As to Medicare, there IS no wage limit, so high earners are tremendously subsidizing lower wage earners for that program.
Finally, your Keynesian economic program does not work nearly as well in spurring the economy as Supply Side economics. It is kind of like eating a sugar cube before a marathon rather than a spagetti dinner. It will give you a little boost for the first mile, but won't get you through the race...
Posted by: Bill H on January 9, 2008 12:13 PMWe would have indisputably been ahead if we'd had tax AND spending cuts.
Posted by: russell garrard on January 9, 2008 12:40 PMI agree with that, but in addition to the supply side effects of the tax cuts, they also kept us out of a nasty recession.
Posted by: Bill H on January 9, 2008 12:50 PMOne could also say that because the Federal Government increased spending (even non-military related spending), this had a Keynesian impact on the economy of also spurring growth, which is again contrary to the supply-side argument.
The supply side argument only works if the money given is directly reinvested into the economy and the dollar multiplier goes to work. If it is invested overseas or in non-labor generating activity it will not spur jobs that could then lead to wages being spent that spurs further job growth (e.g., wage multiplier effect). Tax cuts without federal spending cuts increases the deficit, which then drags the economy later. It is putting off tomorrow/next president the impact of the tax cuts.
As Russell states, how does standing on the principle of tax cuts plus spending cuts not equate to being conservative when coming to government finances, which is the argument being raised against McCain? Just because he doesn't fully buy supply-side economics doesn't mean he isn't fiscally conservative. Chicago School of economics (Friedman/Monetarists) believe in reducing government's strain on the economy that is why the tax cuts plus spending cuts philosophy.
Posted by: tc on January 9, 2008 02:40 PMWhat matters to Republicans is not McCain's EXCUSE for voting against the tax cuts, it is that he VOTED AGAINST the tax cuts. Again, I, and many other think he did it out of vindictiveness, not out of some fiscal conservative principle. And what he said at the time was right out of the Dem playbook--class warfare.
And again, this is not the only strike against him--he also fails on immigration, McCain-Feingold, and the "gang of 14". He has had more than his "three strikes".
Posted by: Bill H on January 9, 2008 02:54 PM1. Supply side theory states that by decreasing marginal tax rates one will see an increase in federal revenue (Laffner Curve). At some point there will be an optimal revenue stream given tax rates.
2. In 2000, the Federal Revenue was $2,025 billion (inflation adjusted).
3. The first of Bush's tax cuts went into effect in July 2001. The Federal Revenue for 2001 was $1,946 billion, $79 billion lower than in FY2000.
4. More of the 2001 tax cut took effect at the start of FY2002, including cuts in the estate tax, retirement and educational savings. Federal revenues in FY2002 were $1,777 billion, $247 billion lower than in FY2000.
5. In 2003, President Bush signed the Jobs and Growth Tax Relief Reconciliation Act of 2003. Income tax rates were immediately reduced and rebate checks issues (without waiting for the new fiscal year). Federal revenues in FY2003 were $1,665 billion, $360 billion lower than in FY2000.
6. Federal revenues in FY2004 were 1,707 billion, $318 billion lower than in FY2000.
7. Federal revenues in FY2005 were $1,888, $137 billion lower than in FY2000.
8. The cumulative total of federal revenues less than in FY2000 for the fiscal years 2001-2005 was $1.142 trillion.
There was no increase in federal revenues as supply-side economics predicted. What saved the us from recession was the Fed's Monetarist (interest rate cuts after 9/11) and Keynesian policy implemented by Bush administration (and Republican Congress) of increasing federal spending. This in turn wiped out federal surpluses and put the country back into deficit spending. So much for conservative economic principles. McCain was right in his prediction back in 2000, just as he was right about the surge in Iraq, when all the other candidates were unwilling to entertain the thought.
Posted by: tc on January 9, 2008 03:16 PMYou have your little delusion about supply side economics. The rest of us will continue to favor tax-cuts...
Posted by: Bill H on January 9, 2008 03:24 PMNot according to the current delegate count at Real Clear Politics.
Posted by: Ragnar Danneskjold on January 9, 2008 03:25 PMIf we reduce taxes AND reduce spending, that in of itself isn't a predictor of what will happen to the deficit or tax revenues. I could have it set up where we reduce taxes and reduce spending more than we reduced taxes with the end result being an increase in the deficit.
This is why the part of the Bush tax cuts that lowered rates on the rich actually forced them to pay more in taxes. If the rich didn't have lower rates, then it would have been the middle class that would have paid more of a burden of the taxes.
Monetary policy in of itself doesn't do a bit of good. And as a greater portion of Federal spending comes in the form of transfer payments to the poor and middle class, then the beneficial effects of supply side becomes less and less.
I always like to ask the question, if there are 10 people earning $10,000 a year and taxed at %10, what can the govt. do to increase it's revenue from $10,000 to $20,000.
Those not understanding supply side economics will say increase taxes to 20%.
Posted by: Doug on January 9, 2008 04:09 PMDoug,
The facts show otherwise. Revenues didn't increase with the tax cuts and it was monetary policy by the Fed that actually helped the most with dealing with Recession.
In the 1980's, it was a combination of Monetary Policy and Fiscal Policy that got us out of the Carter Stagflation. Paul Volcker pushed interest rates up substantially to break the back of the inflation that was strangling the economy and Ronald Reagan got his supply-side tax cuts passed through Congress that brought the economy roaring out of the recession. Do you get it? Monetary Policy to deal with inflation and Fiscal Policy to deal with the economy.
You also don't seem to understand the impact of a decelerating economy on GDP and consequently on tax revenue. You are the perfect illustration of why we don't need Democrats in office that act like they know something about economics, but really don't.
I'm sorry, but your economic ignorance makes it impossible to discuss this with you. Please find a couple of econ courses or books to read and then come back and we can discuss.
Posted by: Bill H on January 10, 2008 08:29 AM