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Tax increases projected to drag economic growth in the next three year


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http://www.frbsf.org/economic-research/publications/economic-letter/2013/june/fiscal-headwinds-federal-budget-policy/

 

 

 

Surprisingly, despite all the attention federal spending cuts and sequestration have received, our calculations suggest they are not the main contributors to this projected drag. The excess fiscal drag on the horizon comes almost entirely from rising taxes. Specifically, we calculate that nine-tenths of that projected 1 percentage point excess fiscal drag comes from tax revenue rising faster than normal as a share of the economy. As Panel B shows, at the end of 2012, taxes as a share of GDP were below both their historical norm in relation to the business cycle and their long-run average of about 18%. However, over the next three years, they are projected to rise much faster than our estimate of the usual cyclical pattern would indicate. The CBO points to several factors underlying this “super-cyclical” rise, including higher income tax rates for high-income households, the recent expiration of temporary Social Security payroll tax cuts, and new taxes associated with the Obama Administration’s health-care legislation.

Conclusion

Federal fiscal policy has been a modest headwind to economic growth so far during the recovery. This is typical for recovery periods and in line with the historical relationship between the business cycle and fiscal policy. However, CBO projections and our estimate based on the countercyclical history of fiscal policy suggest that federal budget trends will weigh on growth much more severely over the next three years. The federal deficit is projected to decline faster than normal over the next three years, largely because tax revenue is projected to rise faster than usual. Given reasonable assumptions regarding the economic multiplier on government spending and taxes, the rapid decline in the federal deficit implies a drag on real GDP growth about 1 percentage point per year larger than the normal drag from fiscal policy during recoveries.

 

 

 

You LOWER taxes during an economic downturn and adjust accordingly when the economy recovers. So simple a caveman could understand it.

 

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You LOWER taxes during an economic downturn and adjust accordingly when the economy recovers. So simple a caveman could understand it.

 

I appreciate your speaking up for Keynesian principles, for once. However, we couldn't count on having a Democrat government when the economy recovers. So things get messy and political.

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http://www.frbsf.org/economic-research/publications/economic-letter/2013/june/fiscal-headwinds-federal-budget-policy/

 

 

 

 

You LOWER taxes during an economic downturn and adjust accordingly when the economy recovers. So simple a caveman could understand it.

 

 

Dems have a problem with the lower taxes part and Reps can't wrap their heads around the adjust accordingly bit.

 

So 13 years later, here we are.

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http://www.frbsf.org/economic-research/publications/economic-letter/2013/june/fiscal-headwinds-federal-budget-policy/

 

 

 

 

You LOWER taxes during an economic downturn and adjust accordingly when the economy recovers. So simple a caveman could understand it.

 

Lol our resident bedpan licker thinks shes an economist now.

 

hahahahahahahahahaha!!!!

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Krugman and Stiglitz say government must increase spending during an economic downturn(pump priming)

 

and, decrease spending when times are good.

 

And AUESTERITY is always makes an economy worse during a downturn. ALWAYS!

 

Putting more $$ into Main Street really stimulates the economy.NOT putting money into Wall Street like QEIII does.

 

I call that "trickle up" theory. The poorer people spend 100% of their money in the economy, whereas the rich don't and just hoard it in hidden overseas accounts, or in speculative Casino gambling on dubious investments.

 

Its too bad we have not tried that the last 5 years. The Obama stimulous was woefully inadequate, and went mostly to his pet special interests. QEIII only feeds the "too big to jail" banks, and pumps up the phony Dow index.

 

Its not too late to have a real stimulous. If we don't do it, Main Street will NEVER recover!



Even the leftist azzhole Paul Krugman has stated to balance the budget in ten years means a V.A.T. AND DEATH PANELS,,,,

Your FULL OF IT!

 

Proof? Links? :angry:



:huh:

What tax increases?

 

Spell it out, fool!

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If we dont invest in the future we wont have one

And by "invest", what you actually mean, is liberals spending other people's money, right?

 

Krugman and Stiglitz say government must increase spending during an economic downturn(pump priming)

and, decrease spending when times are good.

The problem for you, is that Krugman has NEVER advocated lower government spending.

When Clinton was President, he was against all government spending cuts.

 

Krugman constantly contradicts himself depending on the politics of the day. It's amazing anyone takes him seriously.

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And by "invest", what you actually mean, is liberals spending other people's money, right?

 

The problem for you, is that Krugman has NEVER advocated lower government spending.

When Clinton was President, he was against all government spending cuts.

 

Krugman constantly contradicts himself depending on the politics of the day. It's amazing anyone takes him seriously.

By invest i mean invest in the non existent system that works and provides for the people as in all citizens of the US... not non citizens... i anticipate your stupidity you see? the system we have is by the rich for the rich of the rich and only suffers us out of nececity to have someone to man the drive throughs making them burgers and fries... we need to create a tax system that will compete and DEFEAT the new world order system. TAKE BACK YOUR FUTURE AMERICA!!!!!!

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Krugman and Stiglitz say government must increase spending during an economic downturn(pump priming)

 

and, decrease spending when times are good.

 

And AUESTERITY is always makes an economy worse during a downturn. ALWAYS!

 

Putting more $$ into Main Street really stimulates the economy.NOT putting money into Wall Street like QEIII does.

 

I call that "trickle up" theory. The poorer people spend 100% of their money in the economy, whereas the rich don't and just hoard it in hidden overseas accounts, or in speculative Casino gambling on dubious investments.

 

Its too bad we have not tried that the last 5 years. The Obama stimulous was woefully inadequate, and went mostly to his pet special interests. QEIII only feeds the "too big to jail" banks, and pumps up the phony Dow index.

 

Its not too late to have a real stimulous. If we don't do it, Main Street will NEVER recover!

 

Tax cuts are spending DUMBASS. The only reason you don't like them is they actually go to the people who earn for a living as opposed to corporations that contributed to Obama's campaign.

 

 

What tax increases?

 

Spell it out, fool!

 

Incapable of clicking a link and READING?

 

Don't answer... It was a rhetorical question.... :lol::lol: :lol: :lol:

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Dems have a problem with the lower taxes part and Reps can't wrap their heads around the adjust accordingly bit.

 

So 13 years later, here we are.

No, actually it's Dems that can't adjust. Prior to Obama the Federal Government historically was spending about 18% of GDP, today it's over 20%.

You can't just keep spending money you don't have, and even Obama's economic advisers admit you depress GDP by 3% for every 1% of tax increases.

 

By invest i mean invest in the non existent system that works and provides for the people as in all citizens of the US... not non citizens... i anticipate your stupidity you see? the system we have is by the rich for the rich of the rich and only suffers us out of nececity to have someone to man the drive throughs making them burgers and fries... we need to create a tax system that will compete and DEFEAT the new world order system. TAKE BACK YOUR FUTURE AMERICA!!!!!!

Please. Do you even think before spewing this crap? How can you "invest in a non existent system"?

I agree we need a new tax system, but that will never happen because the Dims will never allow it.

 

Tax cuts are spending DUMBASS. The only reason you don't like them is they actually go to the people who earn for a living as opposed to corporations that contributed to Obama's campaign.

I disagree. Tax cuts are only spending if you think the money belongs to the government in the first place. And these idiots don't want corporations of any kind getting the money, they want government control... meaning THEIR government control, which means more free stuff for them.

 

History has shown us that when people control their own money, they spend it, driving the economy. Of course when this happened in the past, liberals derided this idea as evil consumerism.

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No, actually it's Dems that can't adjust. Prior to Obama the Federal Government historically was spending about 18% of GDP, today it's over 20%.

 

There may be other variables to consider than the change of government, Golfboy.

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No, actually it's Dems that can't adjust. Prior to Obama the Federal Government historically was spending about 18% of GDP, today it's over 20%.

You can't just keep spending money you don't have, and even Obama's economic advisers admit you depress GDP by 3% for every 1% of tax increases.

 

Please. Do you even think before spewing this crap? How can you "invest in a non existent system"?

I agree we need a new tax system, but that will never happen because the Dims will never allow it.

 

I disagree. Tax cuts are only spending if you think the money belongs to the government in the first place. And these idiots don't want corporations of any kind getting the money, they want government control... meaning THEIR government control, which means more free stuff for them.

 

History has shown us that when people control their own money, they spend it, driving the economy. Of course when this happened in the past, liberals derided this idea as evil consumerism.

you say im spewing crap lol...

 

youre a moron

 

all new entities begin with new investment... how do i even have a conversation with someone so stupid???

 

 

people control their oun money.... hahahaha youre funny... a very small group of ultra rich control the money hense most have little or none. thats where youre bottle neck in spending comes from... youre simple minded programmed propagandized view is so obtuse i have to assume youre simply another moron who sits in their easy chair or couch watching faux news all day.

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Lol our resident bedpan licker thinks shes an economist now.

 

hahahahahahahahahaha!!!!

 

Every school of Economics supports this, troll.

 

Even Obama's former economic adviser acknowledges it.

 

Only lying trolls and clueless imbeciles hold out.

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Every school of Economics supports this, troll.

 

Even Obama's former economic adviser acknowledges it.

 

Only lying trolls and clueless imbeciles hold out.

 

What did these retards think when Obama's plan was to cut payroll taxes by 2%? They must have gone mad with insanity over it!!!!!!!!!!!

 

NO, they actually supported the tax cut..... :D:D

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you say im spewing crap lol...

 

youre a moron

 

all new entities begin with new investment... how do i even have a conversation with someone so stupid???

 

 

people control their oun money.... hahahaha youre funny... a very small group of ultra rich control the money hense most have little or none. thats where youre bottle neck in spending comes from... youre simple minded programmed propagandized view is so obtuse i have to assume youre simply another moron who sits in their easy chair or couch watching faux news all day.

Yes, I'm a moron because you want to fund a "non existent system". :rolleyes:

But no worries, I knew it wouldn't take long for you to run to the shelter of the "faux news" attacks.

That's what mindless liberal children always do when they can't debate facts.

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Every school of Economics supports this, troll.

 

Even Obama's former economic adviser acknowledges it.

 

Only lying trolls and clueless imbeciles hold out.

 

 

What did these retards think when Obama's plan was to cut payroll taxes by 2%? They must have gone mad with insanity over it!!!!!!!!!!!

 

NO, they actually supported the tax cut..... :D:D

 

.

 

Didja know that chemistry and physics only work if a Democrat applies them? :blink:

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