California: Wall Street hands state a stunner

He most certainly is! Gracious, this is an absolute supply side tax plan that requires you to THINK about what was proposed.Just because the loaded phrase 'capital gains' wasn't mentioned doesn't mean the excludable disatribution account isn't that! He took perjorative tax ideas off the Dem playbook and you can tell by the confusion it brought them.They are baffled.

You still can't explain how a muni bond issuance that was filled at a higher than normal coupon is a sign of gov't crowding(as if that even idea exits!) out that augers poorly for growth, on a national level.You don't know what you are talking about.

Welll, first, it's not an issue of "problems that the government created in the first place" because the point is what effect the spending has on productivity. If spending will improve productivity, then it should be considered. If it doesn't, it shouldn't. The politics, etc., of why there's a problem in the first place doesn't enter in.

Secondly, in many cases there's no malfeasance. Let's take water pipes for an example. Some big cities have water running though wooden pipes. Chicago has water coming in from the lake though brick tunnels. Many places have water running though cast iron pipes. All of these were the best available technology at the time, and they were properly installed. They just wore out though corrosion, rot, age, and shifting land. Same thing with roads; no matter how well you put them in, after a while they just wear out.

>> While I applaud tax cuts anywhere anytime, a non-pro-growth tax cut coupled with higher yield sales of government debt will mean that little growth impact will be felt.

Today's Investor's Business Daily disagrees with you. In the section, "Issues & Insights", it states:

" ... tax cuts will boost the economy and help a broad swath of Americans at all income levels.

Those who oppose the 10-year, $674 billion stimulus package seem particularly incensed by provisions that would end the double taxation of dividends. That, they say, reeks of a gift to the rich.

But some 84 million Americans now own stocks, either in personal accounts, 401(k)s or IRAs. As economists will tell you, cutting dividends will boost share prices - even for those who own stocks that don't pay dividends.

As for other cuts, the plan slashes taxes on 92 million Americans by an average of $1,083 this year alone. It will give 46 million married couples $1,716, on average. It will hand 34 million families with kids an added $1,473.

Do all those breaks go to the rich? Not at all.

In fact, the plan has been carefully crafted to include the middle class and working poor. Even though they pay far less in taxes than those at the upper income levels, they get bigger tax breaks as a percentage of their incomes.

For example, a married couple with two kids and $250,000 in income gets an 8% tax break - not bad at all, you say. A similar family with $100,000 in income gets a 21% tax cut; a family making $60,000, a 27% cut; a family at $40,000, a whopping 96% cut.

As the nonpartisan National Center for Policy Analysis recently noted, families that make over $200,000 a year pay 45% of all income taxes, but get 40% of the cuts.

Families making $100,000 or less, basically the middle class and below, pay 28% of all taxes. But they get 34% of the cuts. And by boosting the child tax credit to $1,000 and ending the so-called marriage penalty, the plan scores a direct hit on working families.

Most people understand that tax cuts boost economic growth over the long run. The Bush plan is no different."

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