Skip to comments.How to avoid a lost decade (Larry Summers calls for more payroll tax cuts)
Posted on 06/12/2011 8:49:54 PM PDT by rabscuttle385
The greatest threat to the nations creditworthiness is a sustained period of slow growth that, as in southern Europe, causes debt-to-GDP ratios to soar. Discussions about medium-term measures to restrain spending and raise revenue need to be coupled with a focus on near-term growth. Without the payroll tax cuts and unemployment insurance negotiated by the president and Congress last fall, we might well be looking at the possibility of a double-dip recession. Substantial withdrawal of fiscal support for demand at the end of 2011 would be premature. Fiscal support should, in fact, be expanded by providing the payroll tax cut to employers as well as employees. Raising the share of the payroll tax cut from 2 percent to 3 percent would be desirable as well. At a near-term cost of a little more than $200 billion, these measures offer the prospect of significant improvement in economic performance over the next few years translating into significant increases in the tax base and reductions in necessary government outlays.
(Excerpt) Read more at washingtonpost.com ...
The biggest busts in the future of the United States is unfunded Social Security and unfunded Medicare; So all these asshats want to strip funding for these basketcase programs.
Back in the old days, a few years ago, it was recognized that payroll taxes were perceived to be directed to the stupid lockbox, now they are just another way to give payroll check concessions to those who don’t pay any taxes.
When will the US learn that it can’t exist if more than 1/2 the population pays no taxes and sucks off the other 1/2!
Who he’s working for is all we need to know.
Larry? Larry? Never mind, go back to sleep. The Harvard University endowment fund thanks you for your astoot management, and the American people thank you for your role destroying the financial futures of so many.
Summers wants YOU to take home an extra $4 per paycheck!
Frankly, I am all for raising payroll taxes, or instituting a minimum income tax bracket that anyone above the poverty line must pay. 50% of the people not paying any income tax is unsustainable.
Actually the Democrats have been whining for years about how unfair it is that people that don’t pay Federal and State income tax have to pay a “payroll tax” to help fund their medical and retirement.
This is the Democrat way to make sure even that gets stripped away to help lock up their votes.
Larry Summers' first sober thought in 40 years.
“Back in the old days, a few years ago, it was recognized that payroll taxes were perceived to be directed to the stupid lockbox”
There has never been a lockbox. Social Security was always designed as a pass-through system. Allowing surplus payments to accumulate in a ‘lockbox’ results in a drag on the economy.
The first time the US ran into a period of surplus payments was back in Johnson’s administration IIRC. Rates should have been reduced to adjust the cash flow, but I seem to recall that good old liberal Lyndon figured out that he could purchase Treasury debt with that surplus and fund his Great Society and the Vietnam War without asking Congress for the money.
And by the way, the 2% reducution in the SS employee payroll tax contained wording that the money would be paid back to the SSTF. In essence, this is just another stimulus program just by another name.
Larry Summers is an idiot in the same category as Goolsbee.
Neither have a frakin’ clue how to fix this economy...not a frakin’ clue. =.=
Instead of the "Guns or Butter" razor's edge, LBJ got "Guns and Butter" by kicking the fiscal can down the road.
My vote: slash government spending. The problem with our economy is too much government and uncertainty over just how much it will grow. A temporary tax cut will do nothing if entrepreneurs fear what comes next.