On Mar 4, 8:34*pm, Howard Kveck wrote:
In article ,



*Scott wrote:
On Mar 3, 7:50*pm, Howard Kveck wrote:
In article
,

*Scott wrote:
As for my views on the direction that the administration is taking, I
just happen to believe (and lot's of economists agree) that you can
not tax/spend our way out of a recession and tax/spend doesn't
actually create lasting jobs.
*To follow a static model that assumes
that investment behaviours won't change as tax rates change, thus
thinking that higher rates = higher revenues is just stupid. *As long
as the tax rules allow for loopholes to protect certain gains, higher
rates will primarily lead to higher levels of hiding income, not
higher tax revenues. *People with money will move their wealth to
minimize the impact of higher rates. *It is silly to assume they'll
just glibly go along and pay more taxes.

* *It's a given that people are going to what they can to minimze their tax
burden. The mistake is assuming that if you give rich people big tax cuts (a la
Bush) they'll help create more jobs. I think the last two decades (at least) have
been pretty ample proof that that is not true.
What happened when Reagan instituted across the board tax rate
reductions?

* *Other people have discussed this but here's my two cents. I think that you're
again missing it on cause and effect, Scott. If you remember, Clinton raised the
marginal tax rates for the top a bit - I think the economy of the Clinton era was
pretty good. So that one sort of counters your Reagan example.

* *Anyway, you did state that you think the Obama economic policy is having a bad
effect on the stock market. This is the other cause and effect problem I mentioned.
The stock market has been slowly tanking for months and picked up steam on that in
the last week or so. I'd suggest a few reasons for that would be the market
responding to the bad economy and news of companies like AIG reporting huge losses.
The bad slide of the stock market is much more attributable to that kind of news than
it is to the economic policies of the new administration. Robert Reich offers this:
_______________________
Second, it's inevitable that stocks, led by the bloated financial sector, would lose
their remaining hot air as the new administration begins "stress-testing" the big
banks, many of which are technically insolvent. After all, their share prices were
built on a tissue of lies and dreams. Other sectors whose values were similarly
distorted and distended by years of financial deception and regulatory disregard,
such as housing and insurance, will also have to return to the real world before they
can recover.
_______________________http://tinyurl.com/dfpjk6(Goes to TPM)

Yep. The bad news FROM LAST YEAR keeps coming, this for example. They
revised the Q4 GDP change from -3.8 to -6.2. That's a whopping
revision:

US ECON: Preliminary Q4 GDP Down 6.2%, Core Inflation at 0.8%
02.27.09, 08:45 AM EST

Washington, February 27 - The Commerce Department downwardly revised
fourth quarter GDP to a 6.2% decline, now the largest contraction
since 1982, when the economy was just pulling out of another steep
recession. Economists were expecting Q4 GDP to be revised only to a
5.4% decline from the 3.8% decline first reported.

Got that Dumbass Scott? Think Obama jumped in a time machine, went
back and did that? That was on Bush's watch. That's one factor
causing the stock market to decline.
-Paul