Private equity firms: Job creators or job destroyers?
The jury is still out. Why? Maybe because these firms aren't interested in creating American jobs. So are they afraid of the results?
Would an income tax hike hurt hiring?
One thing not mentioned: A lot of these tax increases only happen on the portion of their income above $250,000. For a business making $250,001, only $1 would be affected the the rate increase. So I'm curious where the concentration of those businesses lie, close to the $250,000 mark or high enough for the tax increases to be significant.
David Frum: The Deficit Won't Go Down Till The Private Sector Goes Up
Many economists have been saying large government deficits have come about as a result of the recession, NOT runaway government growth. The evidence to back this up is quite strong. Deficits for 2009 were originally projected to be ~$200 bi llion... until the recesion hit and deficits were then projeted to be ~$1.2 trillion. The Obama administration raised that to ~$1.4 trillion. This also further undermines the popular conservative belief that we need to jump into immediate austerity to fix out budget problem.
Bruce Bartlett: Will Defense Cuts Kill the Anti-Tax Pledge?
"Republicans are between the rock of defense cuts that they view as unpalatable and the tax pledge hard place. There is no doubt that Democrats would agree to a tax increase to offset the defense sequester, but would oppose any other altern ative except, perhaps, putting off the entire sequester, including domestic spending cuts, for a year. It’s doubtful that the GOP’s Tea Party wing would support that."
The Republican Plan to Tax the Poor
"According to CTJ, virtually all of these tax increases would apply to families making less than $50,000—people for whom a few hundred dollars can make a huge difference. Unfortunately for them, the media is focused instead on how Obama's tax increases on incomes above $250,000 will make life intolerable for rich people."Paul Krugman: The Hobbled Recovery
"Business investment has actually gone up a lot; maybe you think it should have gone up even more, but it’s not the heart of the problem. On the other hand, we’ve had a lot of cutbacks in government — mainly at the state and local level, but federal aid could have avoided that. (emphasis mine)
This isn’t a picture of an economy hobbled by Big Government; it’s a picture of an economy hobbled by premature austerity."
Brad DeLong: Hopeless Unemployment
"The current balance of probabilities is that two years from now, the North Atlantic’s principal labor-market failures will not be demand-side market failures that could be easily remedied by more aggressive policies to boost economic activity and employment. Rather, they will be structural market failures of participation that are not amenable to any straightforward and easily implemented cure."Paul Krugman: The Secret of Our Un-success
"The Wall Street Journal — yes, the WSJ — explains: Government Cutbacks Separate This Expansion From Others. Over at Angry Bear, Spencer shows that private GDP — GDP not including government spending — has risen almost exactly as fast under Obama as during the “Bush Boom”; of course, if government spending hadn’t been falling despite a weak economy, there would have been more jobs, and private spending would have risen faster." (emphasis mine)Paul Krugman: Poles Apart
"So actually Poland’s success suggests that (a) big government isn’t so bad (b) sometimes its good to debase your currency. Doesn’t anyone tell Romney to do his homework?"Paul Krugman: Dooh Nibor
"The question one might ask is, did TPC – which is actually painstakingly and painfully nonpartisan – make questionable assumptions to get its results, so that some other set of assumptions might portray Romneynomics in a more favorable lig ht? And the answer is no: TPC actually bent over backwards to literally give Romney every possible benefit of the doubt.
...
So they’re actually giving Romney every possible benefit of the doubt – and still his plan is a redistribution from the middle class to the rich. In practice it would surely be much worse." (emphasis mine)WP Fact Checker: Obama’s new campaign ad on dueling budget plans
"Romney’s continued failure to provide enough specifics about his plans certainly lets the Obama campaign openly speculate about the impact. The president, by contrast, is required to present a real budget with actual figures — but as we ha ve shown, he can still play budget tricks to make the numbers add up. So even more detail from Romney might not make the budget dispute any clearer."
Why Washington Accepts Mass Unemployment
A MUST-READ ON THE POPULAR VIEW OF THE RECESSION AMONG THE WASHINGTON ELITE!
"There are signs we’ve hit bottom. Nothing to worry about here. Why risk the possibility of a small outlay merely to provide relief to hundreds of thousands of des perate people? This is such a perfect statement of the way the American elite has approached the economic crisis. They concede that it is a problem. But there are other problems, you know."FactCheck: Does Romney Pay a Lower Rate in Taxes Than You?
"“Bottom line,” said Eric Toder co-director of the Urban-Brookings Tax Policy Center, “if you look at income taxes only, Obama’s statement is not true for most Americans. If you add in payroll taxes, however, it is probably true for lots of people.” (emphasis mine)
No matter how you slice it, Toder said, Romney’s tax rate is very low for someone with his level of income. The average income tax rate for the top 0.1 percent (which is where Romney falls) is 23.6 percent."
Nine takeaways on Romney’s tax plan
Romney's tax plan will hopefully become his biggest handicap in this election. This is the bottom line. Surveys show the American population generally thinks Romney is more able to handle the debt and deficit than Obama. Understanding the f laws with Romney's plans for growth and fiscal reforms should help Americans doubt Romney's competency on these core issues. It will help ensure Romney either fixes the problems with his plan (doubtful, since the problems are fundamental), or loses this election for the right reasons.
AEI Economics: Better Late Than Never
AEI is a bit late to the game, but they are early compared to many Republicans:
"In his podcast Pethokoukis asks the most important question conservatives will have when they hear about this policy for the fist time: Isn't this just promoti ng inflation? In response, Sumner clearly explains why short term inflation is not the same as the Carter-era inflation that many conservatives fear might repeat itself." (emphasis mine)
FACT CHECK: Social Security adds to budget deficit
a MUST READ Fact Check on the question of whether social security is adding to the national debt. It is more complex than most people realize.
Note: Most of our debt does not come from china. Former Sen Judd Gregg has presented a false dichotomy.
Both parties unfazed as ads fail fact-check
The Obama campaign is finally calling out the Romney campaign for its hypocrisy in their insults to Obama's political ads:
""Mitt Romney won the Republican primary only by tearing down each of his opponents with ruthlessly negative campaig ning," said campaign spokeswoman Lis Smith. "His campaign has questioned whether the president understands what it is to be American, attacked his patriotism, and is currently running an ad that a former president [Clinton] and authors of the welfare-to-work legislation have called a flat-out lie. When the Romney campaign finally reaches the high ground, we look forward to greeting them there."" (emphasis mine)One interesting thing here is that these negative ads seem to be benefiting Obama much more than Romney:
"Political scientist John Geer of Vanderbilt University, who has been testing voter reaction to ads, has found that some of Obama's ads attacking Romney have moved voters. But Romney's attacks, so far, have not.
"People know what they think of Obama. Their judgments can't easily be moved," he said." (emphasis mine)In addition, some of these political ads may be relying on fact checker debunkings:
"Indeed, with the ad about the cancer death, the Democratic super PAC, Priorities USA Action, appeared to have gone the fact-checkers one better — exploiting attention to the ad's veracity to get free air time for a spot that has not appeared anywhere as a paid commercial. The ad has been replayed extensively on television news segments that have debated it and has been viewed more than half a million times on YouTube. The largest number of views have come from five states — California and four election battlegrounds, Florida, Pennsylvania, Ohio and Virginia, according to Priorities.
The Democratic super PAC has raised considerably less money than its Republican counterpart, making the free publicity particularly valuable.
Asked whether the prospect of controversy leading to free publicity was part of the calculation, Paul Begala, senior advisor to Priorities, did not hesitate.
"Absolutely," he said. "We're provocateurs."" (emphasis mine)
The Case of the $100 Billion Error1
"Multiple members of Congress have warned that slashing defense spending by $600 billion would devastate the military, with Sen. Lindsey Graham this month predicting the cuts would deal "a death blow to our ability to defend ourselves."
There's just one problem: The number they cite is wrong.
The law triggering the cuts does not slash the military budget by $600 billion. That figure — which has also been widely cited in the media — overstates the amount of military cuts by more than $100 billion." (emphasis mine)
Paul Ryan’s imaginary expertise1
Professor Mark Thoma of the University of Oregon explains how Paul Ryan doesn't uderstand basic monetary or fiscal policy. His budget makes unre alistic assumptions which are backed by few details. Is this what we should expect from the "intellectual leader of the Republican Party."
"Only about one-third of American families will surpass their parents in wealth and income and climb to a new rung on the economic ladder, a new study out today from The Pew Charitable Trusts concludes."
The NFIB is now only representing at most 2% of small businesses.
The Tax Foundation is dishonest about income inequality.
Economists who once supported austerity in the UK are changing their minds
Paul Krugman makes the case that markets are allowing the US to borrow for free, meaning now is the time for short term stimulus and long term austerity.
Paul Krugman explains the euro crises: a central currency with no central government. He then presents potential solutions to the crisis. He Ends by suggesting the euro should be saved but probably won't.
Why does the middle class let politicians get away with unfavorable tax plans? They trust politicians just wouldn't do such a thing.
Charts: America Has the World's Luckiest Billionaires
Arthur Laffer on income inequality, raising taxes
Six Policies Economists Love (And Politicians Hate)1
1: Update 8/18/12
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