Rocket Scientist
Member
Obama lost my vote.
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2012 First U.S. Presidential Debate |OT| OK Libya... We need a leader, not a reader.
- Thread starter deviljho
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He did pretty much say that. I will laugh so hard if that turns out to be the real take-away of the public from this debate.
Quadrangulum
Banned
It was weird seeing Jim Lehrer and even President Obama(!) using the term "Obamacare."
https://twitter.com/BlGBlRD
What rock hard faith in our president you must have had since a poor debate performance could shake your confidence.
speculawyer
Member
Salvor.Hardin
Banned
Really odd to see so many people expecting a sincere debate. The entire night can be summed up by the part when Romney rebuts Obama's reference to a study by quoting some other study himself. That's essentially what the presidential elections has come down to.
Lowering taxes isn't going to magically create the demand necessary to hire millions of additional employees. The poor and working classes are being crushed by the increasing cost of basic necessities coupled with stagnating and declining wages. We have given the wealthy reduced taxes for the past 12 years and they did what they always do, they hoarded the vast majority of the money they saved. Why exactly would I believe they will do anything different this time?
speculawyer
Member
And he'll fire Jim Lehrer . . . but considering the debate moderation, Romney comes out looking pretty good on that one.
He never had your vote to begin with.
Also, anyone who switches their vote now or is still undecided is an idiot.
You have been exposed to Barack Obama on the presidential/presidential campaign stage for 5 and a half years now. And you have seen Mitt Romney campaign for the last 18 months..
You've had plenty of time to digest these candidates and figure out what each stands for. There is no reason for you to be undecided at this ponit.
Yeah, I forgot to address that little tidbit. Ha. The idea is that at a tax rate of 40%, that 5th employee would not be profitable to hire. But at a tax rate of 20%, he would. So that employee would generate his own revenue by expanding the business. Although these numbers other posters have put up make me question how extensive a benefit that really is.
That is very informative. I was searching for a non-biased source, and thought I'd found a legit one. Seems they left out some info. Although I'm not sure whether talks of tax cuts, etc. from Obama and Romney are talking about income tax or total tax, so it still may be a relevant article. But I like your source better.
As I said, my example IS nonsensical. I just threw out numbers to illustrate the concept for those who didn't get it. My numbers are not viable--they're just an illustration of the principles behind (supposedly) viable plans. I'm not positing my own tax plan, guys.
Rocket Scientist
Member
SPEC IS ON FIYA!
Hey don't make fun of us undecided, 50+, college educated, southern white folk!
As has been pointed out a hundred times already, companies don't hire more people just because their taxes go down. And even if they did this scenario is nonsense. The company in your example has only gained $20k in additional net income from this rather generous 20% tax cut. They can't even afford to hire one new employee, let alone 6. So more likely the boss is pocketing $20k while his employees get to pocket a meagre $800 from their wimpy little 2% tax cut.
As I said, my example IS nonsensical. I just threw out numbers to illustrate the concept for those who didn't get it. My numbers are not viable--they're just an illustration of the principles behind (supposedly) viable plans. I'm not positing my own tax plan, guys.
Your example isn't just nonsensical, it's entirely counterproductive to your argument. Put some effort into it, please. And the thing is, pretty much everyone pointing out the flaws in your example *do* 'get it', and reject it as hokum voodoo nonsense. George Bush Sr. even coined the phrase "voodoo economics" to describe it.
Rocket Scientist
Member
Psh, how would you know?
Like I said, the idea is to increase hiring. Now, some posters have pointed out that the rich horde their money. That is probably true. But the majority of businesses are small business. And small business owners tend to want to expand their business by reinvesting profits. That means more employees.
So by lowering tax rates (which will mostly affect small businesses, increasing their profits, leading to an incentive to expand by hiring new employees) and cutting out deductions (which will mostly raise taxes on individuals) Romney is hoping to encourage more jobs. More jobs = more employed = more people with money = more demand for products = more profits for small businesses = expansion = more employed.... etc. That's the idea. How effective it is is largely speculation. I don't think straight-up tax-cuts on businesses is necessarily the best route, but I think this hybrid model might work... maybe. I'm more optimistic about it than I am about Obama's plan.
Demand would be created as more small businesses expand, hiring new employees in their new locations, meaning more people with money to spend to increase demand... see above. Like I said, I'm not sure how well it will work, but the theory seems sound. I think the GOP overplay its efficacy though. But I think Dems underplay it.
Oh my lord. It's speculation like evolution is speculation. In no way and in no imaginable universe could a tax cut in the US with its current tax rates stimulate anywhere close to trillions of dollars in new tax revenues. Even over 10 years. It's just not possible. It's not even a matter of dispute. The only people who argue for it are people who believe in the starving the beast strategy of government shrinkage, and they definitely don't believe it will result in increased revenue.
It's not even about 'rich people hoarding', either. It's about the fact that in order for a company to have enough money after the tax cut to be able to go on a hiring spree they need to have pretty much had that money already available to do so. As your example so deftly showed, nothing but an incredible tax cut is going to result in a business with marginal profits being able to hire even one more additional employee, let alone the tens or hundreds it might take to result in replacement revenue.
Rocket Scientist
Member
My mind if full of fuck right now, but I'm on my phone and class is about to start. 1 you don't seem to even know what has been part of Obama's jobs plans. 2 read the step by step you posted and try and think of a good reason why businesses would expand when the economy is shit and people don't have money to buy even the bare necessities. 3 WTF man.
You're right that it wouldn't offset $5 trillion. I don't know how much it would offset. All I'm saying at this point is, I wanna see what he has up his sleeve. And he seems to be pretty good with money.
With regards to hiring, what you're not considering is the margin. A company doesn't need $40k back in taxes to hire an employee for $40k. All they need is enough to make hiring the employee profitable. It's the concept of diminishing returns. Companies stop hiring employees, because the 5th employee was making them more money than he was paid, but the 6th was breaking even or just under profitability. Employees generally generate their own revenue; companies don't need to pay them any more than they're generating themselves by their labor. So giving a tax break pushes the margin back an employee or two; it slightly lessens the slope of diminishing returns, allowing a couple more employees to pay for themselves, and still be profitable for the company.
EDIT:
1. I didn't know much about either of their jobs plans before tonight. Romney explained his well, Obama didn't. Romney has me interested, and that is all. Obama has two more debates to convince me otherwise.
2. You think no businesses are expanding? The economy hasn't recovered, but there are businesses expanding into my area all the time.
3. IDK man.
Delusibeta
Banned
So, Romney won the debate. Meh! I stand by my previous post in how they don't matter. Obama might lose a percentage point, and that's about it.
Also, I didn't know Paul Ryan got a GAF account.
Also, I didn't know Paul Ryan got a GAF account.
Black Mamba
Member
Tax rates don't determine if an employee is profitable to hire. Taxes are done on profits, which is revenues minus expenses (including wages). Profit maximization is done irrespective of income taxes. Put it this way, if you can make $120k with a 5th employee in profits (that is after you pay him) compared to the $100k with 4 employees, why would going from a 40% tax to a 20% tax driving this change? It's isn't. You'd hire that 5th person at 40% as well because you're still profiting. You'd rather have $120k at 40% tax than $100k at 40% tax, no?
The source I gave are unopposed rates for all those years for the different things. Your source didn't frame it right. It really made no sense to call it income taxes when Romney paid under 1% in actual federal income taxes. Almost all his earnings were taxed at the long term capital gains rate of 15% via actual capital gains and carried interest. he made some money from stuff like giving speeches, but hardly enough to matter in the grand scheme.
Income taxes aren't what actually hit most people, it's the payroll taxes. That's the bulk of the middle and lower class tax stuff.
Obama wants to undo all of the Bush tax cuts for income earners over $200/250k (single/married) as well as institute the Buffet Rule. http://en.wikipedia.org/wiki/Buffett_Rule He's also reduce the corporate tax rate to 25% and cut corporate deductions to match this.
Romney wants to lower all marginal income tax rates by 20%, repeal the estate tax, cut the corporate rate to 25%, repatriation of corp profits held overseas, repeal the Alternative Minimum Tax, eliminate all capital gains taxes for those making under $200k (married) and of course any Obamacare taxes coming in 2013. Mitt Romney claims he will pay for this (estimated at just under $500 billion per year) by reducing deductions for income earners over $250k. The math does not make sense, here, no matter what.
These are the things the two sides have claimed.
As I said, my example IS nonsensical. I just threw out numbers to illustrate the concept for those who didn't get it. My numbers are not viable--they're just an illustration of the principles behind (supposedly) viable plans. I'm not positing my own tax plan, guys.
A hypothetical is useful, a nonsensical scenario is not. The numbers aren't as important as the logic. It's the logic that is nonsense. The concept is the problem.
It won't even offset $1 trillion. It'd be lucky if it offset $1 billion.
Employees do not generate revenue. I'm not sure where you got this idea into your head but hiring people doesn't automagically make you revenue.
Look, Romney didn't invent this concept. His staff didn't invent it either. It's a thing. It's called supply-side economics. Sometimes called trickle-down economics, sometimes more directly called voodoo economics. There are a lot of economists who subscribe to the idea's validity, but only the most ridiculous would describe it in even as positive of terms as you've whittled yourself down to.
You keep acting like you're educating us on this concept when we've heard it before. Anyone who's ever taken a macroeconomics class has heard it before. It *does* have some positive (as well as negative, mind) effects on the economy, but it *does not increase government revenues*. It just does not. Especially when you're starting from ridiculously low tax rates.
Officerrob
Banned
You seriously need to take a macroeconomics class, it would clear-up a lot of your confusion
Black Mamba
Member
But this doesn't happen. Did you see the image I posted?
Reagan and Bush cut taxes and what followed was terrible investment and job growth. Bush Senior and Clinton raised them and look what followed.
It's a myth that tax cuts drive investment. It's more likely to be the opposite (at current low rates). With so low tax cuts, why invest?
And right now borrowing is so cheap that if a small business really wants to expand, they'd borrow to do it. A few extra thousand dollars won't suffice. Most small businesses take in under $100k. And most small businesses won't see much of a tax cut from a 20% rate cut. If they were looking to expand, they'd still have to borrow money.
It's the large businesses/corps who profit hugely from this. And there's no indication they'd invest more, regardless, over paying it out in dividends. After all, large corps borrow all the time to expand even with good cash flow.
Again, this doesn't happen in the real world. This trickle-down economics approach has been thoroughly debunked. It's not speculation.
It's fairy dust. In fact, no economist in the world believes in trickle-down economics right now. And the supply-siders have taken what works and incorporated that into mainstream economics leaving away what was debunked. And numerous studies are out there showing it.
Of course, the image I posted in this post should be enough. Reagan and Bush tried and both failed miserably at it.
Read this study: http://graphics8.nytimes.com/news/business/0915taxesandeconomy.pdf
Let me repeat another point from what I said earlier. Even the most conservative economists who were once supply-siders claim that in the BEST SUPER CASE SCENARIO, tax cuts of $1 lose 65 cents of revenue. In reality, it's going to be more.
Most small businesses don't pay the highest tax rate, nor do they generate enough revenue that a tax cut would be able to cover the additional wages of more employees. Cutting out deductions will leave average people with less money to purchase additional goods and services. It's a clever way to increase the taxes on the working class by giving them a "tax cut".
The above reminds me of this
I'm sorry if you heard it before; I didn't mean to be condescending. But this statement:
...is not accurate, considering the marginal employee, so I figured I'd explain it. I know you all have heard of trickledown economics, and I didn't mean to come off as pompous. But to me, this plan seems to be a little different, because it's shifting the taxes from the business itself to the individuals. So there's more money in the business, but once it gets extracted, it has a heavier tax than it used to. So it incentivizes reinvestment more than traditional trickledown (which I don't think works). That's the idea, it has me intrigued, and I'm willing to hear more. I'm not saying it's gospel.
With the shifting of the taxes from the business to the individual, it might. MIGHT. But you're right that our tax rates are low, so what you say might very well be true.
EDIT:
Yes, I read that before. I haven't thought trickledown worked for a few years now. The reason I'm intrigued is because I don't think it's traditional trickledown. Romney is not just cutting taxes on businesses, he's raising taxes on individuals, effectively, after deductions are removed (I pay virtually no taxes right now). So money is more efficiently used when invested, and when you pull it out, it gets taxed harder, like I mention above the edit.
Bush and Reagan, as far as I'm aware, merely cut taxes for businesses; I'm not aware of them shifting the burden of taxation off the business and onto the individuals. Feel free to correct me if I'm wrong, though. I don't mean to seem dense to what you're saying; I really am reading it all and integrating it. I think I communicated myself poorly and indicated my support for traditional trickledown (i.e. cut taxes on business, they will invest it) whereas this idea is more intriguing to me (shift the burden of tax from the business to the individual, thereby incentivizing investment and discouraging hoarding.) But if I'm just describing another aspect that's also been debunked, I'm more than happy to ditch the idea.
EDIT 2:
Just saw your posts down below. I've got to go to bed, but thank you for the engaging conversation, guys! Will definitely mull it over.
IrishNinja
Member
several pages later, and looking back, this advice really should've been heeded
Black Mamba
Member
It's not shifting taxes from businesses to individuals. Small businesses overwhelmingly pay taxes as individuals right now. Ever hear of pass-through taxes?
Romney isn't proposing any cuts to small businesses directly, only cutting the marginal tax rates on personal income taxes (corp rates yes, but very few small businesses make enough money to qualify here though it happens. But these already rake in huge profits).
You can't cut taxes on mom and pop stores and raise them on employees because they pay the same taxes. There isn't a separate small business tax. Don't believe me, go ask a small business owner. They pay the same taxes you pay as a worker (assuming you are an employee for someone).
No, it's the same thing. That was always the idea behind trickle-down economics. Lower taxes so employers hire more people (and pay the people they already employ more) who pay taxes. The reality is that it's market demand that drives employment and wages. I'm not sure where you thought the anticipated increased government revenue in those theories was supposed to come from.
And the marginal employee doesn't mean anything. Please see Black Mamba's posts for a better explanation than I could (or did) manage.
Might would be very generous. Won't is more likely. Tax rates would have to be astronomical for it to work. In the 20s taxes were dropped from ~60% to ~25% and revenue did increase, but I'm not sure it's ever worked otherwise. Even when they again dropped from the 60s to the 30s in the 1970s.
Please at least read this: http://en.wikipedia.org/wiki/Supply-side_economics#Effect_on_tax_revenues through to pretty much the end of the page.
IrishNinja
Member
real talk: does anyone else have "libertarians" on your facebook page that are cheering romney for tonight's effort?
a social conservative who wants to expand government...yeah, congrats there guys, might want to just start owning that neocon shirt you're wearing
a social conservative who wants to expand government...yeah, congrats there guys, might want to just start owning that neocon shirt you're wearing
That is silly. This is the first time the two have debated. We really do not know what either parties future plans are right now because they are keeping it all close to the chest.
The idiots are the people who already know who they are voting for. Because they are basing it on nothing. No plan, not a concrete position from either side. If you are not in the position to change your mind one way or the other based on the information displayed by both opponents over the next month, then you are the brainless idiot.
They weren't blank slates before this election, you realise
You didn't know that every four years they hit a reset button on someone's positions?
Romney's is closer to three months
Rocket Scientist
Member
Yeah Obama's sure been keeping his presidential activities top secret. Congress sure did vote on a lot of top secret bills. Lots of secret bills were passed we have no idea what was in them. Oh god the secrets, I'm drowning in them.
You've already said too much. We're all on a watchlist now dammit. I wanted to fly to Canada again some day, but you you've ruined it for everyone.
Rocket Scientist
Member
Are you genuinely confident Amirox? In don't think he'll lose because the situation in battleground states is great, but this is going to make the race closer than it should be.
I am genuinely confident. Because it's not about national polls, it's about battlegrounds, and one debate is not going to erase the extremely strong ground work laid by the Obama campaign, particularly in rust belt states. He's already polling a consistent 5~ points ahead in Ohio, and he has 96 field offices compared to 30 some for Romney there, he was way ahead in polls during the start of Early Voting, and a debate isn't going to change Romney's "let Detroit go Bankrupt" or his 47% comments, not entirely, and Obama is going to continue to rule the airwaves on that front.
And then there is the Electoral College on a broader scale; something like a seismic shift would have to occur for Romney to be a odds-on favorite. And the debate, while clearly a loss for Obama, is not that. It simply gives Romney his first real winning news cycle all campaign, which for Romney must seem like heaven, for Obama supporters must seem completely unfamiliar and horrifying, but in the end is not enough to win an election.
I'm not a tinfoil hat person but if Obama's performance last night was a one time deal and he shows up to play at the other debates it may have an even more powerful impact than if he had won each one...
No it wont.
Every time someone brings up Howard Dean I'm disappointed they're not talking about Howard Beale. Now there was a screamer.
Salvor.Hardin
Banned
Not at all. All he had to do was play it safe. The electoral numbers are on his side and he didn't take any chances by getting into a mud slinging contest with Romney. At this point, Obama simply has to not say anything absurd and let the ads play out till November.
Romney was well-prepared. Incredibly so given his previous performances in the primaries, which although were good, were nothing closely Presidential like last night. Props to his team for helping him get to this point where he can talk policy while being charismatic.
Speaking of policy, does anyone have a link to an article that lists Romney's policy aims from the debate last night? It seemed like he had made some recent changes, but I'm not entirely sure about that.
Why can't he actually say this? In an "eloquent" way. And why hasn't it been promoted by other politicians or independent groups, either before Romney campaign or now? Where is this idea coming from?
What percentage of actual, taxable business income is being passed through to individuals to be taxed? And what is the total dollar amount?
GrotesqueBeauty
Banned
Here's hoping the next round is more interesting. This one was pretty dry. I almost started nodding off a few times. Obama was listless and an overly zealous Romney attempting to suddenly look moderate after months of cementing himself as a corporate stooge promised flowers and sunshine for all without any coherent strategy. Both were terrible about following the format, and came across as too self important to heed the moderator.
Overall I think Romney benefited from being in the groove of constant campaigning and the contrast offered by his seemingly disinterested opponent. Up until now his campaign was working against him as he put his foot in his mouth everywhere he went, but at least he's in practice and hungry to win. So far Obama has been able to sit back and let Romney make stupid mistakes without engaging him directly, but he's got to work on his game if he doesn't want to lose ground during these debates. It was embarrassing how many huge openings Romney left him that he didn't capitalize on in the slightest.
Overall I think Romney benefited from being in the groove of constant campaigning and the contrast offered by his seemingly disinterested opponent. Up until now his campaign was working against him as he put his foot in his mouth everywhere he went, but at least he's in practice and hungry to win. So far Obama has been able to sit back and let Romney make stupid mistakes without engaging him directly, but he's got to work on his game if he doesn't want to lose ground during these debates. It was embarrassing how many huge openings Romney left him that he didn't capitalize on in the slightest.
This is the real key to this debate. Romney just gave Obama everything he needs for Florida adverts on medicare. He just gave everything Obama needs for Ohio adverts on further bad math.
He sat back and let Romney run away from his own previous quotes. Its too late for Romney to run to the middle now, he's given too much red meat to the base in the last few months that can be off-set with this debate to torch him in key swing states.
All this debate did is shift the "undecideds" in hard red states, those "I'm a libertarian but always vote for my wallet/my moral world view" types. That won't win an election.
teruterubozu
Member
Gee that debate really swayed my opinion. What a fucking sideshow.
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