Social Question

ETpro's avatar

Does the American right know that in the political context, right does not mean correct?

Asked by ETpro (34202 points ) May 17th, 2011

Preacher and theologian, Jim Wellis wrote an interesting book in 2006 that tackles at least on part of this question. It’s title is God’s Politics: Why the Right Gets It Wrong and the Left Doesn’t Get It, and it’s well worth reading. But I wonder if the terms left and right are harmful to our political discourse well beyond the wrongs of the “religious” right. When used in a political context, left and right have nothing to do with direction, correctness, or being right there as opposed to having left the building.

The terms originated during the French Revolution of 1789 when supporters of the King’s divine right to rule sat on the right side of the National Assembly while the populists of the proletariat took up the left side of the chair. So the origin of political right is not correct or right there but royalists favoring the divine rights of an unelected, elite minority to permanently rule over the unwashed masses.

How many Americans who self identify with the right today know this? How many actually think that right in a political context actually means correct, no matter what policy the right may advance? When it comes to things like the notion of deliberately defaulting on the National Debt, this question really matters.

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32 Answers

woodcutter's avatar

is this a trolling attempt? You do know what can happen here if q’s like these pop up, don’t you? Somebody is going to show their ass and help make Fluther a little bit less fun.

ETpro's avatar

@woodcutter It is most certainly not a trolling question. I care a great deal about this country, and I participate here and elsewhere in discussions to do what I can to encourage critical thought instead of slavish devotion to political demagoguery. I don’t care which side is playing the demagogue, I will take either on.

The question is a simple one. There is nothing remotely untrue in the details. The fact that you would lash out at me and accuse me of being a troll for asking such a straightforward question suggests that you think some voters do believe that right-wing equals correct-wing, and you want to preserve that false notion and attack anyone who points up the fallacy of it.

woodcutter's avatar

Not lashing at all. And I didn’t accuse, sorry you took it that way You know, the threads that will get the occasional jackhole response blanket statement to the tune of Right wing people are idiots and then, there sets up a piling on effect that exposes the dim maturity that hopefully this site attempts to discourage. I know even when they are trying to subtle it can come off as quite ignorant sounding. And I don’t consider myself close to being a right winger at all. If the questioner does attempt to inform that they’re not wanting that rhetoric, it makes a big difference. We are a ways from election time but it will be cranking up soon enough and that is when those kinds of questions tend to heat up from both sides. It gets old.

ETpro's avatar

@woodcutter Thanks. Rest assured this question is not a trolling attempt, and I will do my best to beat down any trolling it may generate. It is simply a reminder of what right means in a political context. Personally, I am liberal on soime issues, conservative on some, and libertarian on others.

Jaxk's avatar

Everybody understands thier right from thier left. Except possibly, those voters in Florida that couldn’t quite figure out the voting machines. You try to say this is a real question but then use it to denigrate the right.

We are racking up about $5 billion a day in debt. The left wants to make raising the debt ceiling a must so we don’t default and oh by the way, we can also continue to rack up debt at this incredible pace. The right wants to make it an issue that requires dealing with the spending problem. There is a way to solve this but there has been no attempt from the White House to do anything about spending. The issues are tied together. Screaming about one without addressing the other gets us no place. And the French revolution has nothing to do with either.

ETpro's avatar

@Jaxk As much vitriol as you have poured out herein about liberals and progressives, you have no room to criticize. But just how does this question denigrate the right? It simply says that the word, in a political context, does not mean correct. It instead means a political orientation once associated with the French royalists but now associated in American Politics with Republican political orientation.

The National Debt debate is one area where I believe the right is clearly wrong. That’s why I included it. I could easily list a legion of issues where I think the left is wrong as well, but that’s not the point of this question.

Raising the debt cieling is necessary simply to repay the debt we currently own on US Treasury Bonds. If we do not do it, we will default on the full faith and credit of the US government, and plunge the world’s financial system into chaos and an almost certain great depression. Likewise, if we suddenly cut government spending by $1.6 trillion a year, we will plunge the country into depression and take the rest of the world down with us just as we did in 1929.

So holding the debt cieling hostage to a balanced budget is rather like saying I won’t shoot you in the heart if you’ll just willingly cut your own head off. It’s taken us 3 decades to pile up this debt, and we aren’t going to grow the economy enough to solve it by wildly extreme austerity programs or by simply defaulting on our debt obligations.

Jaxk's avatar

@ETpro

There’s no question we’re on opposite sides on most issues. Unfortunately everyone wants to argue from the extremes. Whether liberal or conservative, this never solves the problem. Democrats want to argue that we have to raise the debt ceiling to salvage our credit rating (which is likely to tank anyway). Conservatives want to argue that we can’t raise the debt ceiling without a balanced budget (or at least a plan to get there). Neither position is viable and if we are realistic, we all know that. Unfortunately the political gamesmanship has gotten completely out of control.

We can’t balance the budget in one year. It’s just not realistic. Yet we also can’t just ignore the deficit with platitudes like ‘we’ll address it down the road’. The Fed has been keeping interest rates unrealistically low. That can’t continue forever. Fears of downgrading our credit rating are already rampant. Interest rates will rise and when they do, our payment on the debt will double (at least) driving the deficit even higher, making budget cuts even larger and more painful. We need some ‘light’ at the end of this tunnel. The Ryan Plan was an attempt to provide some light at the end. Maybe it’s not the best plan, hell I have some issues with some of it. But it is at least a plan to slow the growth of the debt (and really doesn’t slow it very much). I would love to see an alternative from the left. Instead all we get it criticism with no alternative.

If you top out all your credit cards, you may need to refinance that debt. But any decent credit manager will tell you, you need to curb your spending habits when you do. Refinancing and continuing to spend beyond your means, not only won’t solve the problem but will drive you to bankruptcy even faster. The USSR was a helluva an empire but the debt brought them down when all the military might in the world couldn’t do it. We like to think that can’t happen here but we are rushing towards that eventual end at a breakneck pace.

I’m not looking for a balanced budget, just a way to get there. And I think you’ll find, that is what both the Republicans and the Tea Parties are looking for.

ETpro's avatar

@Jaxk I completely agree with your first paragraph of analysis.

The Ryan Plan added $6 trillion to the deficit over the next 10 years and cut taxes for the rich and corporations yet again, while killing Medicare and slashing spending for those in need. We’ve been trying to tax cut our way to a balanced budget for 30 years. Jobs have flown off shore. The debt has soared from $1 trillion to $14 trillion. At some point, we have to put new revenue on the table along with spending cuts.

Both spending cuts and tax hikes will slow growth. But spending cuts aimed at the low income and middle income taxpayers hurt growth the most.

The Republican hate government crowd won control of the party with the Reagan Revolution. They have been slashing taxes through direct tax cuts and through the addition of tons of loopholes for the rich and corporations for 3 decades to starve the beast to death. I think they are way off base in their contention that if we eliminate all entitlements, get rid of any meaningful regulation, and turn Wall Street loose to do as it pleases, everything will run itself like clockwork. If two savings and loan bailouts plus the massive financial meltdown of 2008 haven’t yet disabused the right of that notion, then they are data proof. I guess the fight will just have to play out to its ugly end.

Jaxk's avatar

@ETpro

It would be nice to keep this on a more factual basis rather than the extreme talking points. Reagan lowered the top tax rate to 28% (as well as lowering all tax brackets). We currently have a 35% top tax rate so to say that Republicans have been lowering taxes for 3 decades is factually incorrect. Also when you say that Republicans have been trying to starve the government beast by lowering taxes, that’s not borne out by the numbers. It sounds cute but the truth is that when taxes are lowered, government revenues have increased. And the top 5% of income earners have paid a higher share of those taxes. In reality the increase in personal and dependant exemption rose to $500 under Reagan and then to $1,000 under Bush which benefited the lower incomes much more than the higher. I know you want to make this a class warfare argument but it simply doesn’t pan out.

“I think they are way off base in their contention that if we eliminate all entitlements, get rid of any meaningful regulation, and turn Wall Street loose to do as it pleases, everything will run itself like clockwork.”

That is exactly the kind of statement I was referring to when I said we argue from the extremes. No one is looking to eliminate all entitlements nor all regulation. Again it sounds cute as a talking point but has no basis in reality. Do I think we have too much regulation? Hell yes!!! That doesn’t mean I support eliminating all regulation or anything like that. But the truth is for every dollar you spend on merchandise, 50 cents goes to pay for regulation. Is that too much? I would say yes.

As for the loopholes and subsidies, I would love to say Republicans don’t do it. Unfortunately, that’s not the case. But Democrats are just as bad. Why are we giving waivers for the Health Care bill? There are some subsidies that I would support but you may be surprised at which ones. As a baseline, I would support eliminating ALL subsidies. With farm and oil being at the top of the list. The tax loopholes I find quite interesting. Every time we discuss any change to the tax code, we begin picking and choosing credits or exemptions based on who you want to benefit. In other words, who will get the loopholes. If we eliminated all loopholes and exemptions, you would be screaming that the lower income was impacted the worse. And if the truth is told, you’d be right.

Any good marriage counselor will tell you that when arguing with your spouse, you should not use words like never or always. That should hold true for political debates as well. When you argue with absolutes from either left or right, you force a response in kind from the other side. It is one reason we seldom get agreement or resolution on these issues. IMHO

ETpro's avatar

@Jaxk As usual, our discussions soon devolve into your providing true facts that seem to make my facts incorrect, because you conveniently forget to mention important details. Reagan lowered the top rate from to 28% and now it’s 35%. True. But you failed to meantion that it was 70% before he slashed it to 28%, and we were doing well and paying down our debt as a percent of GDP from WWII till that cut. That’s no small change. He tripled the national debt in 2 terms, something no other peacetime president has ever come remotely close to doing. In 1981 when the Reagan Revolution began, virtually all corporations paid some income taxes if they were profitable. Today over ⅔rds of them, including the world’s most profitable corporation, Exxon-Mobil, pay no income taxes. Only smaller start-ups get stuck with corporate taxes till they get big enough to take advantage of the loopholes, which were written into the tax code to accommodate corporate jet setters, not entrepreneurs who actually generate most of today’s new jobs.

You also left out that while the rate is now 35%, Clinton raised the top rate to 39.6% and actually began paying down the debt as a percent of Gross Domestic Product. Bush lowered it to 35%, and made numerous adjustments as well that benefited only the rich. The capital gains tax has been cut. The estate tax has been gutted so generational wealth begins to rule. Over 40% of the benefits of Bush’s tax adjustments went to the top 1% of income earners. And he took a national debt that was under control under Clinton and doubled it again.

The wealthiest 1% of Americans now own over 40% of all the wealth in America. And yet supply-siders are far from ready to give up. Paul Ryan’s budget calls for more tax cuts for the rich and corporations.

You can spin like a top trying to deny it, but the Republican Party and sometimes the Democrats too have used the easy sell of tax cuts being free magic-money from heaven. Tax revenues as a percent of GDP are substantially down over the past 30 years while costs of government have increased with a growing economy and more complex world. We have a revenue problem as well as a spending problem, and to date, Republicans are ONLY willing to talk about spending cuts. Even subsidies for the worlds most profitable corporations, big oil, are off the table according to Republicans in the Senate.

Here’s a video that puts the facts in simple ennough terms it’s hard to spin away.

bkcunningham's avatar

@ETpro are you sure it was 70 percent before he slashed it to 28 percent?

jonsblond's avatar

According to the majority of media outlets, left = right,

right = Sarah Palin ignorant.

ETpro's avatar

@bkcunningham Indeed. Here are the top marginal rates by year from 1913 till today. It had been as high as 94% on income over $400,000 during WWII. Of course, in 1944, $400 grand was a boatload of money, and you got to keep most of the earnings up till that top rate. President Kennedy proposed cutting it to 70%, and Johnson actually signed that new rate into law. The 70% top rate prevailed till Reagan cut rates to 28%, the same as factory workers payed. And far from wrecking the economy and costing jobs, we did VERY well. The period was called the post war boom. We really built our powerful middle class during that period.

bkcunningham's avatar

Just to be clear (for my feeble mind trying to following this discussion), @ETpro, we are talking personal income tax rates. Not corporate, right?

Jaxk's avatar

@bkcunningham

Just to help with the problem, the history of corporate tax rates are listed in this article. I highly recommend you read the article rather than just looking at the tax rates since they are quite misleading. The exact same problem occurs when you look at the individual tax rates. The problem is the complexity of the tax code. Currently there are over 71,000 pages in the tax code. Do you suppose there may be things in there that could help reduce you tax burden? To quote Henry David Thoreau – Simplify, simplify. That’s what Reagan did.

If you look back at what Reagan did with the tax cuts, he didn’t just lower the rate. He removed a lot of the loopholes/deductions/incentives (whatever you want to call it). The most damning evidence against “Tax Cuts for the Rich” crowd is that when Reagan took office the top 1% paid 17% of all taxes. After the tax reduction we find that the top 1% pay 40% of all taxes. How could that happen if the tax cuts only benefited the rich? The truth is the lower income brackets have seen significant rate reductions and the deductions for lower income have skyrocketed. So much so that we currently find over 40% of tax returns PAY NO INCOME TAX. In the golden years most liberals moan about, when the top tax rate was 70% or higher, most Americans paid taxes. Now after the tax cuts that “only benefited the rich” almost half the country pays no taxes. How the hell did that happen? Numbers like the 70% figure are thrown out there for shock value. Unfortunately they mean nothing without context. A tax rate without the definitions of taxable income, or incentives just doesn’t tell the story. Here is an article that talks about the results of the Reagan tax cuts and why they work. Read the article and watch @ETpro‘s video (if you can stomach it). See which one seems more realistic.

@ETpro

I watched your video (at least most of it) and there is nothing but spin. No context, no detail and major assumptions based on one graph (that also has no detail or context). I do however, have a question. If you feel Reagan was so horrible based on excessive spending, how do you continue to cheer the excessive spending we are experiencing today? And if spending were the key to mitigating the recession, wouldn’t the $3 trillion we’ve spent have some noticeable impact?

ETpro's avatar

@bkcunningham Yes, the chart I posted was, as @Jaxk noted, for individual income tax rates. And I totally agree with @Jaxk that tax code simplification would be a great first step in addressing the revenue side of out debt problem. If we limited deductions to such things as charitable contributions and mortgage interest on say the first $400,000 of a home loan, that would go a great way to boost federal revenue and also make filling out our tax returns far simpler.

I also would like to see corporate taxes made fair at the very least. Massive corporations like Exxon Mobil and General Electric should not get by tax free when struggling entrepreneurs are socked. If it were up to me, I would eliminate corporate income taxes, and roll that revenue over to individual income taxes, capital gains.and estate taxes. In truth, corporate income taxes end up being paid by the consumers anyway. Corporations just pass on the costs. Our businesses would be far more competitive on the world market if we recognized that fact, and changed our tax code accordingly.

@Jaxk The video is far from spin. Every chart is backed up by statistic from the http://zfacts.com/p/318.html site, which draws it chart data from here. These are factual numbers and as a matter of public record, it would be easy to honestly refute them instead of simply arguing by assertion that they are “spin”. It’s easy to trot out wishful thinking and denigrate actual numbers, but it leads to wrong-headed conclusions.

We aren’t talking about small discrepancies where right-wing claims are 10% off of the ones shown by Zfacts.com. The Voodoo Economics claim is that tax cuts always cause revenues to skyrocket and put tens of millions to work. The truth is supply side ran up over $12 trillion in debt and George W. Bush has the worst job creation record since Herbert Hoover in the depth of the Great Depression. You an cry and scream or sit and steam, but these facts are way to mountainous to be dismissed useless because they are slightly off.

Jaxk's avatar

@ETpro

I think you misunderstand my point. I didn’t say he was lying or that his chart is wrong merely that he was spinning his numbers to make a point and ignoring other relevant data. Which is not much different than what you are doing with the Bush job creation numbers. The truth is unemployment averaged just over 5% for his entire term in office. It was going up as he took office, down after the tax cuts, and then up again at the end (shown here). But if you can isolate a number like ‘job creation’, Create the end points at the beginning of a recession and then again after another recession, you can make some political ‘hay’ out it. Of course if you look at the unemployment figures from the past as you see here, Bush actually looks pretty good. Spin is all about picking the right number, defining the end points, and ignoring everything else.

So with all this in mind let’s look at some real numbers. Congress actually spends the money. So when Bush took office (with a Republican congress) the national debt was 5,727,776,738,304.64. When the Democrats took congress in January 2007 the debt was 8,675,085,083,537.48 or a growth of just under $3 trillion in 6 years. When Obama took office (with a Democratic congress) the debt was 10,626,877,048,913.08. And it stands now at 14,345,510,847,235.26. Or about $4 trillion in 2 years. So let’s recap real quick.

Bush and the republicans averaged $500 billion/year in debt.
Bush with the Democrats averaged $1 trillion/year of debt.
Obama with the Democrats averaged $2 trillion/year in debt.

All factual and pertinent. It seems that if the Democrats get even a toehold on the purse strings, they escalate the debt by leaps and bounds. And your cutesy little video can’t spin that away.

The debt has nothing to do with supply side economics but rather spending. Government revenues and the economy have increased when tax cuts were implemented. Unfortunately when government revenues increase the spending increases even faster (usually).

Reagan has said that he regretted not being able o hold the line on spending. Bush simply spent too much. But neither had any concept of what spending the democrats could do with a filibuster proof congress. And if you look back at the Clinton administration (let’s not forget it was a Republican congress), what he actually did was to reduce the rate of growth of SPENDING. I applaud him for that.

ETpro's avatar

@Jaxk Spin on. You are trying to say that spin in the tape makes Mount Everest out of an ant hill. There isn’t any spin involved in the fact that George W. Bush’s job creation is the worst since Hoover. That’s from the Wall Street Jounal, for goodness sake. Hardly a leftist spin journal. Most of Bush’s tax cut did not take effect until late in his presidency. So crediting it with ending the recession of 2000 is pure spin. Either that, or Bush employed a time machine to get the effect of a tax cut before it even happened. The truth is that the next recession set in shortly after his full tax cut was implemented.

And your contention about Reagan and Bush being unable to hold the line on spending falls apart on the inspection of the facts, as well. Righties liove the lie that the Democrat [sic] Congress made Reagan spend. But the truth is that in every year of his presidency, they appropriated less than he requested in the budget he submitted. Bush enjoyed a GOP Congress until 2006, and even after the GOP lost control of the House, they had filibuster power in the Senate and the veto pen of the President. Sorry, but the devil didn’t make either Reagan or Bush explode the debt, their own tax and spending policies did.

Jaxk's avatar

@ETpro

I’m not sure where you get you information but the tax cuts took effect mostly in 2003. Even those that were originally scheduled to be implemented in later years were brought up to be effective in 2003. That’s hardly late in his term. You’re just factually incorrect on this one. You may have been looking at an old article about the 2001 tax cuts (again hardly late in his term) which scheduled some of the cuts in later years (2004–2006) the 2003 tax cuts however brought therm all in to be effective in 2003. Check your data (or look here). And not surprisingly, the economy and jobs began to recover in (drum roll please) 2003.

As for your job creation numbers, you need to make a point. We had unemployment at about 5%. That is considered full employment by most economists. An unemployment figure much lower than that causes run away inflation. So if we had full employment, what is the point of your number?

As for the rest of your argument, you haven’t addressed the numbers. Yes bush had a republican congress through 2006. During which we ran an average deficit of $500 Billion/yr. From 2007 til 2009 Bush had a Democratic congress and ran an average deficit of $1 trillion/yr. Since the Democrats have taken the Whitehouse and congress (2009) we have run an average deficit of $2 trillion/yr. You can scream ‘Nah-Uh’ all you want but those are the numbers. But your right about one thing, the devil didn’t make them do it, the Democrats did.

ETpro's avatar

@Jaxk Here’s what I was working from. If that’s obsolete data, do you have a link to more up-to-date information?

As to what’s the point on job creation, right-wingers claim tax cuts always produce more jobs. Clinton raised taxes, and in his administration we gained 23.1 million new jobs. Bush cut taxes and there were 2.5 million jobs created in 8 years before we lost 7.9 million jobs in the Great Recession.

Again I say, you are trying to equate an ant hill to Mount Everest by claiming the ant hill is slightly higher than I stated it to be. When you are dealing with performances that differ by an order of magnitude or more, a few inches this way or that are of no importance. Any fool can see Mount Everest is higher than an ant hill. No sophisticated measuring tools are requires.

Jaxk's avatar

@ETpro

You continue to equate the Clinton years to the tax hikes. Do you honestly believe that the tax hikes created the Internet boom? Because that’s what created the jobs. His tax hikes merely7 created a slight leveling of the growth curve in ‘93. His spending policy however, did have an impact on the deficit.

As for your 7.9 million jobs lost, remember that 6 million of those were lost on Obama’s watch. You seem to want to shift you end points on any measure to accommodate the statistics you want. The truth is when Bush took office unemployment was on the rise. It rose to over 6% (6.3 to be exact) in 2003. When the tax cuts were enacted, the job growth began bringing the unemployment rate down so that by 2004 it hit 5% and in 2005 it came down under 4% and stayed there until 2008. This is all clearly visible in the chart I posted above but since you’re having trouble with it, I’ll post it again.

When the recession hit in 2008 Bush was a ‘lame duck’ and had little power to deal with the recession. TARP was an attempt to stave off the worst of it and it did it’s job. Unfortunately Obama decided to embrace the policies of FDR and try to tax and spend our way out of recession. And just like the ‘30s we are stuck at the bottom prolonging a recession that should be winding down. I can’t understand why anyone would be surprised by these results since they are the same policies and the same results from the ‘30s.

So Obama has taken a recession that should have been an ‘ant hill’ and blown it into ‘Mount Everest’. If that’s your point, then I agree.

ETpro's avatar

@Jaxk It is every bit as logical as believing the Bush tax cuts created the housing bubble. I do not think that tax policy alone was responsible for the robust economy, nor do I think the Internet boom was spectacular enough to account for it alone. I attribute it to a mix of factors including the dot.com boom and sound fiscal policies in government.

Where I am having problems with your arguments, and with those of the right-wing in general, is that despite clear evidence that tax cuts drive up deficits and don’t do all that much to stimulate the economy, you continue to insist exactly the opposite is true.

ETpro's avatar

@Jaxk And yes, I do think that since it was letting Wall Street run amok that caused the 7.9 million jobs to be lost, it is on Bush and the GOP in general no matter who was in office. You drive a car over a cliff, handing off the wheel to someone else doesn’t make the aaccident their fault. And the GOP continues to push for even further deregulation of Wall Street and a return to the same Casino Capitalism that caused the mess. Blaming them is beyond fair, it would be insanity not to hold them accountable.

ETpro's avatar

@Jaxk Here’s Tom Toles (Wash. Post) cartoon that gives a pretty accurate picture of both party’s current handling of the debt problem.

Jaxk's avatar

@ETpro

It is difficult, in politics for anyone to give ground or concede any point. It is always blown out of proportion. But in the interest of moving us forward let me give you a point. Yes when taxes are reduced the first thing that happens is a drop in revenue and an increase in the deficit. But what is also true is that the economy rebounds and the government revenues begin to increase, shrinking the deficit. Here is the chart on government revenues. Note the drop in 1983 and in 2003. Also note the growth following those drops. If you look at unemployment it follows the same pattern. When the tax cuts are made the unemployment numbers begin to drop. It is hard not draw some obvious conclusions from that.

Let me throw in another wrinkle to address your Clinton years. If you look at GDP , the economy grew at a faster rate throughout the 90s. If you look at spending , it grew at a slower rate. That is what accounts for the shrinking deficit during the 90s and spending was the piece that government controlled. As I said previously, I applaud Clinton for that.

Over the past century we have had 5 major recessions/depressions (1920,1929, 1980, 2000, and 2008). There have been numerous shorter recessions that are hard to account for other than just economic cycles. During each of the past recessions that were addressed through tax cuts (1920, 1980, and 2000) the response has been clear and quick with economic growth (and jobs) making an almost immediate turnaround. During the other two (1929 and 2008) the problem was addressed with spending and tax hikes. Both of these resulted in long and drawn out recessions with very slow and jobless recoveries. We can ignore that and continue on this course or take a lesson from history and turn this around. It may be time to put ideology aside and get us out of the hole. Once we’ve recovered, then you all can start back on the redistribution of wealth and tax hikes and what ever else you have in store for us.

ETpro's avatar

@Jaxk Thanks for the link, but it really doesn’t show anything very different from the one I posted back at the beginning of our debate that showed revenue as a percent of GDP. The spike in revenues in the 2005–2008 period corresponds to the rapid growth of the real estate bubble and the massive $72 trillion per year derivative market Wall Street ran up based almost entirely on wildly leveraged mortgage debt, most of it stated value and non conforming loans to speculators. That massive bubble distorts both the chart you posted (which unfortunately doesn’t state whether or not it corrects for inflation) and the one I posted, which inherently does correct for inflation.

About what ended recessions and depressions, a bit of fact checking is in order.

The 1920–21 depression most likely was produced by the end of WWI, the return of a large number of men to the workforce, high interest rates instituted by the Federal Reserve and a rapid decrease in Government spending by the Pres. Warren G. Harding. It is a flat-out falsehood to claim that tax cuts ended it. Taxes remained the same through the entire brief depression of 1920–21. And when taxes were dropped in 1922 after the depression had ended, the marginal rate they applied to dropped from $1,000,000 (a king’s ransom in the 1920s) to $200,000. So that tax adjustment likely had little effect on GDP, and did not take effect till the 1923 tax year..

Taxes were cut 6 times after the 1921 depression ended, with the last cut coming in 1929 dropping the top rate to 24%. And did that make the GDP take of like a rocket, or crash like a lead balloon?

Nor did the Reagan tax cuts perform miracles. Graphing the real GDP against the top marginal rate after the 1980–82 recession, they did just the opposite. If the final tax rate of 28% had been left in place, the US would have hit its debt crisis far sooner than it did. Even George H. W. Bush realized that, and sacrificed his hope of reelection by doing the responsible thing and raising taxes.

Likewise, the recession of 2000 to 2003 recovered before any substantial tax relief kicked in from the Bush Tax cuts. The rates were as follows::
2000—39.5%
2001—39.1%
2002—38.6%
2003—35%

The real drop in tax rate did not apply till the 2004 tax year. It cannot have accounted for the end of the recession in December of 2003. The 2003 tax year was still taxed at the $38.6% rate, just 1% down from the Clinton years.

I’d love to live in a world where tax cuts always equated to revenue increases and GDP explosions. We could just immediately reduce taxes to negative 100%. Earn $100,000—get a check from the IRS for a matching $100,000. If tax cuts always boost revenue and growth, both the government revenues and the GDP would rise on an asymptotic curve toward infinity. We could pay off the $14.6 trillion national debt in one year—if that actually worked. Obviously from simple logic and from the above cold hard facts, it doesn’t work though. But playing Santa does make for good politics—or did till the nation started waking up to the facts.

Jaxk's avatar

@ETpro

Time to stop screwing around and just deal with the facts. The tax Act of 1921 was passed in 1921 (thus the name). It was effective for tax year 1922. The rates came down from a top rate of 73% to a top rate of 56% (a very noticeable change). The brackets in-between the bottom and top rates were also squished so that tax payers were paying a slightly lower rate as well. For instance if you were making $10,000, in 1921 you would pay 11% tax. In 1922 you would pay 9% tax. If you really want to know when and how much taxes were, here is a source that will not only give you the top rate but all the brackets for the year that they were effective. It goes all the way back to 1913 so unless you have issues prior to that, it should help you out.

Now back to our problem of the 1920 recession. Since the tax cut was passed in 1921, both business and employees could plan on it. The economy grew in 1922 (coincidentally the year they were effective) so why would you believe that they could not have had an impact on the growth? It would seem the linkage is iron clad.

As for the Bush tax cuts, they were effective for tax year 2003. When they passed the 2003 tax cuts they made them retroactive for the entire year. If you take a look at the tax rates I linked, you’ll see that not only was the top tax rate 35% for year 2003 but the new tax rate for the lower income of 10% was effective for tax year 2002.

I would make a suggestion but I know you don’t want to take it from me. Hell, I’ll do it anyway. Instead of looking for liberal bloggers to reinforce your preconceived ideas, look for actual data and facts to shed light on the situation. For instance, when I saw your link to the Reagan growth rate, my first question was why would they start in 1984? We know the growth rate was negative prior to that so why set the end points there. If you take a “look:http://www.econdataus.com/gdpchg08.html at a little broader time frame, you’ll see why they did that. The economy came screaming back after the tax cuts so of course it settled out to a more reasonable pace by the mid 80s. and why would they go out to 1992 and stop. Well of course that would be so that they could include the small recession in 1990 and show a downward trend. As I said previously, spinning is all about picking the right number and the right end points. And if you can, make it look like a coincidence that you picked those points.

One other thing you need to keep in mind. When tax cut or tax increases pass the congress, they have an immediate effect on the psychology of businesses and investors. Both are looking at a longer range horizon and what they will be paying next year and the out years affect how they invest. It’s no different that any other person would do. If you know you will be getting a raise in salary, it will affect your decision to buy a new car (or house or any other major purchase), even though you haven’t gotten the money yet. It’s how people plan.

You were actually making a reasonable argument, even though it was factually wrong, until you got to the last paragraph. I’m not sure why you resorted to the ridiculous 100% argument unless that is just something ingrained in liberals. If they think they’re making a good argument they take it from the absurd to ridiculous.

“But playing Santa does make for good politics—or did till the nation started waking up to the facts.”

I certainly hope Americans are waking up to the facts. Obama has been playing Santa with our tax money for every constituent he has. And using Stimulus and other government give-a-ways to rebuild his base. A good wake up call is definitely in order.

ETpro's avatar

@Jaxk Obama inherited a Hobson’s choice from Bush. Play Santa and stave of a depression, or play con-man and get blamed for the havoc Republican ideology wreaked. It was 30 years of Santa giving money (tax breaks and loopholes) plus deregulation to their corporate jet setters that led to the great recession of 2008. It’s hard to smear enough lipstick on the pig to prove that Obama caused a recession that started almost a year before he took office.

Jaxk's avatar

@ETpro

It looks like you’ve devolved into generalities with no basis in fact. But I’ll leave you with parting thought. We all have seen your graph defining debt and the presidency. Take a look Here and see what it looks like if you use congress as the basis. Afterall, congress is where the money gets spent and if the Democrats have control of congress, it gets spent in spades.

ETpro's avatar

@Jaxk I plead guilty to losing interest in debating further. It seems pointless. This is off topic for the OP and I feel we’ve both long since lost the rest of our audience.

Jeruba's avatar

I am continually astounded at the depths of some people’s ignorance, which somehow seems to have a lower bottom than any knowledge, but it never occurred to me that right-wingers might think this “right” meant the opposite of wrong. When the left played on the words of Goldwater’s 1964 presidential campaign slogan “In your heart you know he’s right” by adding ”—far right,” it was a pun.

[I came upon this question some nine months later, by way of a “Siblings” sidebar.]

ETpro's avatar

@Jeruba When confirmation bias gets strong enough in a person, there are things they may consciously know to be absurd, but still might accept viscerally. The way the right fulminates against anything liberal or progressive leads me to believe they indeed do “think” in their gut that right as in right-wing means correct.

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