Posted on 08/10/2010 7:41:15 AM PDT by BenLurkin
No fan of tax hikes in ordinary times, Mauldin says raising taxes now -- with the economy at "stall speed" and inflation near zero - is "very dangerous."
A tax hike now could tip the economy back into recession, "which is by definition deflationary," he tells Henry in the accompanying clip. "When you're already [at inflation] not much more than zero, it would be complete disaster: Unemployment will go way up [and] tax receipts way down."
Rather than letting the tax cuts expire in 2011 as scheduled, they should be extended for another year for the wealthy, says Mauldin, who believes it's "patently absurd" for the administration to argue that wealth people don't change their spending habits when taxes rise.
"It's one thing for academics to argue" whether tax hikes really effect the rich, he says. "I don't want to find out at 1% GDP growth, I want to find out at 3%."
(Excerpt) Read more at finance.yahoo.com ...
Obama Administration Is “Dead Wrong” About Taxes, David Malpass Says
“Why is the U.S. standing out like a sore thumb raising the top marginal rate?”
Malpass offered the following answers to his own question:
— “Politicians are addicted to spending and expanding their fiefdom.”
— Treasury Secretary Tim Geithner and top Obama economic advisor Larry Summers are “dead wrong” about people’s sensitivity to higher tax rates, Malpass says. “Data show the economy is very sensitive to the top marginal tax rate; that’s where much of the innovation is done.”
— Geithner’s comment Monday at NYU that the economy can “absolutely” handle the expiration of Bush tax cuts for the top 2% is “wrong and self-serving,” Malpass says. “Secretary Geithner is presenting an argument that’s really good for Washington,” where the Value Added Tax (V.A.T.) is the “next frontier.”
Obama The Destroyer. Raising taxes makes perfect sense.
Very dangerous and patently absurd you say? Sounds great! Where do I sign?
That’s supposed to have the pretend HTML ( Obama ) and ( /Obama ) tags but the HTML editor messed things up.
Right. He is a Communist. He will do whatever he is allowed to get away with.
The Bush tax cuts were across the board. Rather than framing the discussion around extending the tax cuts for the wealthy, it should be extending the tax cuts for all. The so-called wealthy are many small business owners who file individual returns that encompass their business operations. Unless Congress takes action, all of the tax cuts will expire for everyone.
It will take libs looking at their first paycheck next year to figure that out.
The Obama administration is clueless (if not then they’re dangerous).
The tax cuts on marginal rates for the ‘rich’ hurts those that ‘earn’ their income. That leads to less activity or changes in methods.
Geithner has promised that capital gains and dividends, the methods that sustain the RICH their lifestyle (Buffett), will only go up to 20%. Who IS giving the RICH a tax break while punishing the rest of us?
A lot of people were saying, back when the housing collapse became commonly accepted as actually happening, that there were only two ways out of this:
1. deflation and depression.
2. Hyperinflation.
The idea behind the latter is that a $5000 a month house payment is nothing if the minimum wage is $75 an hour. Simply monetizing everyones debt would do that. Unfortunately, this time the money is owed to foreign countries. Monetizing the debt could result in war.
The idea behind the former is that the country is forced into austerity - including the government - and the economy is basically “reset” as we live in a “The Waltons” culture and we all help each other out of this thing.
Problem there is that this time a HUGE portion of the US is living off entitlements and the country doesn’t have the religious character it did back in the day. So we will have riots and other nastyness. And if Erkel raises taxes it WILL get ugly as the producers continue to go Galt, often times involuntarily. It would be like a man lost on a desert island attempting to survive by eating his own organs.
Is that the infamous tax that was to punish the rich, but instead the workers that built the yachts got laid off?
yep, that’s the one.
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