Mythbusting Conservative Tax Theory

For decades my friends on the right have told me that the best way to stimulate the economy is to lower taxes … particularly for those in the highest tax brackets; those who make the most money. The theory is called trickle down. Those who make the most money, if allowed to “keep” more, would invest in business and that investment would create jobs. The jobs would create income for more people who, in turn, would pay collectively pay more taxes thereby increasing government revenues. The money in the hands of the most wealthy would effectively trickle down to those with more modest means.

I finally got tired of hearing about it so I thought I’d do a little research to see if the numbers might support the proposition. I mapped the tax rate assessed against those in the highest tax bracket (and for the sake of comparison, I mapped the lowest tax rate, too). Then I looked up the unemployment statistics and mapped them as well.

I looked at the period from 1948 to 2009. The post-WWII years are universally recognized as America’s most productive years …. the heyday of our growth. I discount much of the so-called “growth” of the last 15 years or so on the grounds that it was a fantasy based on over valued real estate. The recent real estate “bust”, with home values plunging faster than anyone could track, foreclosures, and the implosion of the over leveraged financial sector is evidence of that fantasy. The value, labeled “growth” by my friends on the right was an illusion. It was a house of cards, propped up by a banking Ponzi scheme that “monitized” bad debt by bundling shaky mortgages sold on the premise that home prices would never go down and repackaged into financial instruments to conceal their flaws.

So, let’s look at the numbers.


Sources: IRS and US Bureau of Labor Statistics.

For the sake of this exercise, the Blue line at the top represents the highest marginal tax rate in effect during each tax year. One can read the tax percentage on the scale at the left of the graph. The Red line at the bottom similarly indicated the lowest tax rate and, again, the percentage can be read on the scale at the left of the graph.

The solid green line tracks the rate of unemployment from 1948 to the present while the green dashed line is the linear trend line of the unemployment rate through that period.

What I noticed is that there is a very high inverse correlation between the highest tax bracket rate and unemployment. What I mean by this is generally the lower that tax rate, the greater the rate of unemployment. As one tracks the tax breaks extended to the wealthy versus the unemployment trend line, one gets the distinct feeling that the conservative mantra of lower taxes equaling a stronger economy seems to fall apart assuming the rate of unemployment is any measure of economic strength.

The Liberal Elite

"They always throw around this term 'the liberal elite.' And I kept thinking to myself about the Christian right. What's more elite than believing that only you will go to heaven?"
-- John Stewart, The Daily Show

Kipling Understood War in Afghanistan

A scrimmage in a Border Station
A canter down some dark defile
Two thousand pounds of education
Drops to a ten-rupee jezail

- Rudyard Kipling

My comment: The more things change, the more they remain the same. Those who do not study history are doomed to repeat it.

Quote of the Day

"Rational arguments don't usually work on religious people. Otherwise, there wouldn't be religious people."
-- Doris Egan

My comment: It takes a certain genius to state the obvious ... and real genius to state it so succinctly.

I am a liberal because …

I posted the following in April, 2006. Now, with the bruhaha over Harry Reid's comments on the floor of the Senate about consevatives, I think its appropriate to re-post it. I would caution not to confuse "conservative" with "Republican". Today's Republican Party may be the home of American Conservatism today but it hasn't always been that way. Lincoln was a Republican when he authored the emancipation Proclamation but he was also a liberal.

*************************

In a firefight with several conservative types, I woke up this morning and sent this off to a friend (a liberal) who edits a newspaper out in the world to get his/her feedback and maybe help me sharpen it up a tad:

*************************

I am a liberal because I believe that every child should have a childhood filled with learning and school days and the endless days of summer while conservatives opposed the child labor laws which make that possible.

I am a liberal because I believe that women are equal human beings capable of independent thought while conservatives in the past opposed a woman's right to vote and now to have any say in her destiny.

I am a liberal because I believe no one should be the property of another while conservatives fought a war in this country to preserve slavery and the proposition that people should be property.

I am a liberal because I believe in equality under the law while conservatives worked to preserve "Whites Only" drinking fountains, lunch counters and restrooms.

I'm a liberal because I believe the richest nation on the planet should provide a safety net for its citizens; that it should protect those disadvantaged by social or economic factors or who have been subjected to the ravages of age from the starvation we see in so many other places in this weary world - while conservatives take the position of Cain, who, when asked by God, "Where is Able?" replied, "Am I my brother's keeper?"

I am a liberal because, in spite of failures along the way, liberals have never failed to look for new solutions to old problems while conservatives have never failed to embrace the causes of the problems and label them virtues.

I am a liberal because I believe that by working together we can make a better future while conservatives believe the best future we can hope for looks exactly like the past.

I am a liberal because, throughout history, liberals have consistently supported these ideals while conservatives have, with equal consistency, positioned themselves on the wrong side of history.

***********************

In response, I received the following from my editor friend:

Perhaps you should share this with your liberal brethren, because they seem to be lost these days, unable to work up a moral high ground.

The real reason you're a liberal is that you're not afraid, not in the bone-weary sense that the right is. Fear of change, fear of "others" and fear of oneself create the state in which all things conservative can fester.

I have seen some extraordinarily liberal individuals turn into cowering conservatives when their sense of safety is shattered.

Right now, we have an entire nation of people whose fear outweighs their security. Somehow, the liberals have to push the notion that an open, free nation is not just our imperative, it's necessary if we want to become secure.

That ain't an easy sell. Good luck.

More: Why Right Wingnut Republicans Can't Govern

AND

• don't understand economics
• can't read polls
• can't balance a budget
• support deficit spending when they're in office
  
• can't understand the implications of climate change
• are afraid of the census
• don't get that "tax and spend" is actually "pay as you go"
• think that Medicare for All is a government takeover
• imagine funding war is good and while providing health care (at a fraction of the cost) is bad

My comment: You'd think they'd get it after getting debunked time and time again. No poll has ever represented 120% of the respondents. Only 100% of the people who answer a given question can represent all the people who answer the question. But in Fox-Conservative la-la land, 120% of respondents can answer a question.

Fact checking is a lost art on the right.

Why Right Wingnut Republicans Can't Govern

OR

• don't understand economics
• can't read polls
• can't balance a budget
• support deficit spending when they're in office
  
• can't understand the implications of climate change
• are afraid of the census
• don't get that "tax and spend" is actually "pay as you go"
• think that Medicare for All is a government takeover
• imagine funding war is good and while providing health care (at a fraction of the cost) is bad
  

It's because they think a pie chart can add up to more than 100%!

Faux Noise brings it all together ... one picture is worth thousands of words!

Zombie Reagan Fails The Reagan Test

or watch the video on on YouTube after the click ...

My comment: not since the days of Joseph Stalin and Adolph Hitler has a political party demanded a loyalty oath to the party before the country ...

The Death Party

David Sirota on Huffington Post

Think about it: On health care, Republicans are arguing that Democrats are "rushing" legislation through Congress - legislation that would bring down the astronomical number of deaths that occur thanks to our broken health care system. At the same time, they are attacking President Obama for not more quickly escalating the Afghanistan War - an escalation that would likely result in a large number of American and Afghan deaths.

Read the rest on Huffington Post after the click.

New Word: Republizombie

by Andy Borowitz on Huffington Post

Republizombie (re-PUB-li-zom-bee) (n)

1. Former GOP office-holder, now undead, unkillable; see Palin, S.; Cheney, D; Delay, T.; Armey, D.; Gingrich, N. A flesh-eater, the Republizombie counter-intuitively eats the flesh of other GOP; see 23rd Congressional District, NY.

2. Former relative of a former GOP office-holder, such as the former fiance of the daughter of a former Governor; like the other Republizombies, the second-tier Republizombie is seemingly ubiquitous, appearing on The Today Show, Tyra, and naked in Playgirl.

Candy's Latest

Spread out over the living room floor. Sunlight streaming through the glass door to the patio. Still unfinished, but getting there. Borders, binding and quilting still to go.

Experts have described the situation as the worst mass poisoning of a population in history

from Discover

It was a twisted cycle: In the 1970s, Bangladeshis used surface ponds or rivers to collect rainwater for drinking. But thanks to garbage dumping and sewage, that water became a breeding ground for disease. So UNICEF sought to fix the problem—the agency helped residents drill simple wells that drew water from a shallow aquifer. But this remedy became a tragedy. Bangladesh’s groundwater was laced with arsenic. Now, in a study in Nature Geoscience, a team from MIT has answered one of the outstanding pieces of the Bangladesh puzzle: Just how all that arsenic got into the water in the first place.

Bangladesh occupies the flood-prone delta of the river Ganges [New Scientist], and that river brought the arsenic to the region’s sediments. But why doesn’t it just stay in the sediments once it’s there? Back in 2002, another MIT team began to answer the question by showing that microbes digest organic carbon in the soil in such a way that frees up the arsenic, but they couldn’t say where that carbon itself came from until Rebecca Neumann and colleagues figured it out this year: man-made ponds left behind by excavations.

Read the rest in Discover after the click ...

My comment: How can "the worst mass poisoning of a population in history" escape the notice of the world press? Probably because Bangladesh doesn't have anything that anyone anywhere else in the world covets ... like oil or other minerals. Gotta have something that someone else wants if you want someone else to be interested in your plight. Otherwise, you're on your own ...

Retire?

You can retire to Phoenix, Arizona where........
1. You are willing to park 3 blocks away because you found shade.
2.. You've experienced condensation on your butt from the hot water in the toilet bowl.
3. You can drive for 4 hours in one direction and never leave town.
4. You have over 100 recipes for Mexican food.
5. You know that "dry heat" is comparable to what hits you in the face when you open your oven door.
6. The 4 seasons are: tolerable, hot, really hot, and ARE YOU KIDDING ME??!!

You can retire to California where...
1. You make over $250,000 and you still can't afford to buy a house.
2. The fastest part of your commute is going down your driveway.
3. You know how to eat an artichoke.
4. You drive your rented Mercedes to your neighborhood block party..
5. When someone asks you how far something is, you tell them how long it will take to get there rather than how many miles away it is.
6. The 4 seasons are: Fire, Flood, Mud, and Drought.

You can retire to New York City where...
1. You say "the city" and expect everyone to know you mean Manhattan .....
2. You can get into a four-hour argument about how to get from Columbus Circleto Battery Park, but can't find Wisconsin on a map.
3. You think Central Park is "nature."
4. You believe that being able to swear at people in their own language makes you multi-lingual.
5. You've worn out a car horn. ( Ed note: if you have a car)

You can retire to Maine where...
1. You only have four spices: salt, pepper, ketchup, and Tabasco .
2. Halloween costumes fit over parkas.
3. You have more than one recipe for moose.
4. Sexy lingerie is anything flannel with less than eight buttons.
5. The four seasons are: winter, still winter, almost winter, and construction.

You can retire to the Deep South where...
1. You can rent a movie and buy bait in the same store.
2. "Y'all" is singular and "all y'all" is plural.
3. "He needed killin'" is a valid defense.
4. Everyone has 2 first names: Billy Bob, Jimmy Bob, Mary Sue, Betty Jean, Mary Beth, etc.
5. Everything is either "in yonder," "over yonder" or "out yonder." It's important to know the difference, too.

You can retire to Colorado where.....
1. You carry your $3,000 mountain bike atop your $500 car .
2. You tell your husband to pick up Granola on his way home and so he stops at the day care center.
3. A pass does not involve a football or dating.
4. The top of your head is bald, but you still have a pony tail.

You can retire to the Midwest where...
1. You've never met any celebrities, but the mayor knows your name.
2. Your idea of a traffic jam is ten cars waiting to pass a tractor.
3. You have had to switch from "heat" to "A/C" on the same day.
4. You end sentences with a preposition: "Where's my coat at? "
5. When asked how your trip was to any exotic place, you say, "It was different!"

OR You can retire to Florida where..
1. You eat dinner at 3:15 in the afternoon.
2. All purchases include a coupon of some kind -- even houses and cars.
3. Everyone can recommend an excellent dermatologist.
4. Road construction never ends anywhere in the state.
5. Cars in front of you often appear to be driven by headless people.

Republicans believe strongly in property rights

... unless the property happens to be yours:

Chris Christie Rips Off Monty Python, Risks Copyright Infringement

Jackson Brown v. John McCain

Heart to Sarah Palin: Quit Playing 'Barracuda'

Aerosmith to House GOP: Don't Use Our Song

Satire, Parody, and Copyright: Republican Govs Ape NYT’s Format netting a cease and desist order.

Dont' Worry, Be Happy: The song was used in George H. W. Bush's 1988 U.S. presidential election campaign until McFerrin, who was a Democrat, objected and the campaign desisted.

I guess it's always easier to defennd a lawsuit beg forgiveness than it is to ask for permission?

FACT CHECK: GOP Math Suspect In Stimulus Debate

Beware the math. Some Republican lawmakers critical of President Barack Obama's stimulus package are using grade-school arithmetic to size up costs and consequences of all that spending. The math is satisfyingly simple but highly misleading.

It goes like this: Divide the stimulus money spent so far by the estimated number of jobs saved or created. That produces a rather frightening figure on how much money taxpayers are spending for each job.

On Friday, the White House released estimates that $160 billion in stimulus spending created or preserved 650,000 direct jobs.

By the critics' calculations, that's over $246,000 a job – and a terrible deal for taxpayers. Why spend nearly $250,000 to employ a highway worker or a teacher making a small fraction of that?

The reality is more complex.

First, the naysayers' calculations ignore the value of the work produced.

Any cost-per-job figure pays not just for the worker, but for material, supplies and that worker's output – a portion of a road paved, patients treated in a health clinic, goods shipped from a factory floor, railroad tracks laid.

Read the rest on Huffington Post after the click

My comment: During the 2008 Presidential campaign, then Republican candidate, John McCain, experienced a stunning moment of truth telling when he admitted that economics was not his strong suit. (Presumably "Bomb, bomb, bomb Iran" foreign policy is his strength.) Republican policies of deregulation on Wall Street, tax cuts for the rich and the off-shoring of American industry drove our economic buss into the ditch. Perhaps it's time for the whole right wing to admit that economics is just not their strong suit.