The Atheist Communist Caliphate Made Flesh, Spread the Clusterfuck Around Thread

[Chuck to Chuck]

I'm not sure what you're showing here, Chuck.  These are the national income accounts as I know them.

Y = Output
C = Consumption
G = Govt Spending
I = Investment
T = Taxes
       
Y = C + I + G (we will ignore trade here, speaking simply about national income accounts)

That's one side of the NI equation.  The other side is what do people do with their income.  They either Consume or Save.  So, not only does C+I+G+(X-M)=Y, we also have C+S=Y.

If G and X-M both equal 0:

C+I=C+S

Subtract C from both sides and:

S=I.

Now, if we embark on discussions of marginal propensity to save and consume, the MPs sure seems to be negative these last few years.

[Andre Dawson's Creek]

I'm not sure what you're showing here, Chuck.  These are the national income accounts as I know them.

Y = Output
C = Consumption
G = Govt Spending
I = Investment
T = Taxes
       
Y = C + I + G (we will ignore trade here, speaking simply about national income accounts)

That's one side of the NI equation.  The other side is what do people do with their income.  They either Consume or Save.  So, not only does C+I+G+(X-M)=Y, we also have C+S=Y.

If G and X-M both equal 0:

C+I=C+S

Subtract C from both sides and:

S=I.

Now, if we embark on discussions of marginal propensity to save and consume, the MPs sure seems to be negative these last few years.

Didn't we already agree it was 42?

[morpheus]

I'm not sure what you're showing here, Chuck.  These are the national income accounts as I know them.

Y = Output
C = Consumption
G = Govt Spending
I = Investment
T = Taxes
       
Y = C + I + G (we will ignore trade here, speaking simply about national income accounts)

That's one side of the NI equation.  The other side is what do people do with their income.  They either Consume or Save.  So, not only does C+I+G+(X-M)=Y, we also have C+S=Y.

If G and X-M both equal 0:

C+I=C+S

Subtract C from both sides and:

S=I.

Now, if we embark on discussions of marginal propensity to save and consume, the MPs sure seems to be negative these last few years.

In the aggregate it was, although I'd say now it has turned positive.  In fact, I'd say that's what folks like Eli and ADC were arguing above - an additional dollar of disposable income will be saved and not spent on consumption.  Of course, when a dollar is "saved" it actually ends up being "invested" in new capital, as you have shown, and this has a whole additional set of implications for interest rates and so forth.  It's not like that dollar just goes into a bank and sits there.  I think that's where you were going with this in the beginning, right?

[Philberto]

The problem is that rich people slow their spending after a certain point.

When well-to-do people get more money, it usually sits there on top of the pile.  If someone has $250 million in the bank, are they really going to go on a spending spree because they just grabbed another $2 million? 

But they're not putting $250MM in a savings account or into their mattresses.  Where do you think they're putting this $$?

Probably wherever it can best trickle down to the needy, right?

Absolutely.  If it's in the capital markets, it might be so a company can expand and add new jobs (good jobs, too).  Or it could be in the credit markets, where $$ are desperately needed so companies that need credit to keep their doors open can meet payroll.  Or it can be spent in the form of charitable giving, which apparently only bleeding hearts engage in according to DeJesus.  Or it can be spent on a couple more cars, (maybe even American cars if the domestic automakers built anything worth buying) or another house. Hell, it could even be used to overpay for a National League Franchise and a 94-year-old building.

C+I+G=C+S

C is on both sides, so...

I+G=S

G is ideally 0 because, if budgets are balanced, G=C-t.

Therefore, S=I.

Savings = Investment.

Savings is good.

*Putting on Macroeconomist's hat*  I'm not sure what you're showing here, Chuck.  These are the national income accounts as I know them.

Y = Output
C = Consumption
G = Govt Spending
I = Investment
T = Taxes
       
Y = C + I + G (we will ignore trade here, speaking simply about national income accounts)

Rearranging,

Y - C - G = I

Adding in taxation, which is just a transfer from the private to the public sector:

(Y - T - C) + (T - G) = I

The first term is "private saving" and the second is "government saving" in that iteration.  The sum of those is just "saving."

S = I

That class blew.

[Bonk]

Well, I do remember 1993, the last time the Democrats controlled both houses of Congress and the White House. We had the biggest tax increase in American history.

Up for debate. Some more detail:

http://www.slate.com/id/1037/

Good piece. I'd have to say that even though Dole proposed that tax increase, the Democrats controlled Congress and then Reagan approved it, that falls on them and not Dole.

The "most of the 1993 taxes fell on the affluent (paraphrased)" is too much of a generalization. If more of their money goes to the government and they can't spend it, then that hurts everyone.

If 'everyone getting hurt' = the Clinton era, well... come on, baby, make it hurt so good.

The Clinton era was balanced by the Republicans controlling Congress the final six years. That's why so much got done. I'm not knocking Clinton on this point, just saying it's not as simple as saying him being president is why the economy ran well in the 1990s, nor was it just because of Reagan that the 80s went well.

I'm just trying to highlight the fact that, for some reason, in late 2008, you're apparently predicting that the 1993 Clinton tax plan will "hurt everyone."

What I was pointing out was that story's overgeneralization that most of those taxes' effects were felt by the affleunt. It's my experience that when we resort to "taxing the rich" and those people have money taken away, everyone feels the impact.

This is your experience?

Or just your axiom?

Not the best worded sentence, granted, but if you take money out of the pockets of well-to-do people instead of letting them spend it, it affects everyone.

They have less money to spend at porn shops and strip bars, cut back grocery spending, go out to restaurants less and have less money to give their drug dealers, and all of those industries then make less money, thus it negatively impacts all of them.

I'm not sure how you can disagree with that.

The question is not whether taxes on the affluent, considered alone, take money out of the system. It's whether the negative effects of this outweigh the good.
And, given that we're still discussing a tax plan from a decade and a half ago, it would seem that there's some room here for at least some empirical considerations above and beyond a priori principles.

I agree, it just sounded like you were saying you disagreed with my assessment entirely.

I think the '93 budget is still worth discussing because a) the same economic principles still apply, and b) we're about to turn the entire set of keys to Washington over to the Democratic party for the first time since, so it's important -- at least to me -- to evaluate what happened the last time this was the case.

Obama has already said the same types of tax increases are coming -- at least he didn't lie about it like Clinton -- so that scenario is worth revisiting.

[Eli]

In the aggregate it was, although I'd say now it has turned positive.  In fact, I'd say that's what folks like Eli and ADC were arguing above - an additional dollar of disposable income will be saved and not spent on consumption. 

I was lost once you guys started adding up letters.

[*In a Nutsack]

( . )( . )

[Jon]

( . )( . )

Thi

[Thrillho]

In the aggregate it was, although I'd say now it has turned positive.  In fact, I'd say that's what folks like Eli and ADC were arguing above - an additional dollar of disposable income will be saved and not spent on consumption.

I was lost once you guys started adding up letters.

Seriously... Those two are awful, awful spellers.

( . )( . )

_______

   8==D~

[*In a Nutsack]

Dude, e-dicks is where I draw the line.

[Uncouth Sloth]

Seriously...isn't this what we started with in the first place (page 1)?

All I got out of this is that we are trading George Clooney, Ronald Reagan and Yeti for Jake Peavy and Michelle Obama, and cash.

[DwightKurtz]

Any of this sound familiar?

'Fighting for the Forgotten Middle Class'
"America is in trouble. Our people are hurting. The rich keep getting richer and the politicians just seem to be taking care of themselves. It's time we took care of our own. If America's not strong enough at home, we'll never be able to stand up for what we believe in around the world. National security begins at home."

BARACK OBAMA OFFERS AN ECONOMIC PLAN TO COMPETE AND PROSPER IN THE WORLD ECONOMY

Barack Obama will cut taxes for the middle class and make the rich pay their fair share.
Barack Obama will encourage and maintain commitment to better education at every level.

BARACK OBAMA OFFERS A NEW AMERICAN HEALTH CARE PLAN
Middle-class working families are living in fear everyday that if they get sick they'll lose everything. That's wrong. In his last year as President, Barack Obama will present a new American health care plan to:

Cover everybody.
Control costs, improve quality, expand preventive and long-term care.
Maintain consumers' choice of doctors.
Take on the insurance companies and the medical bureaucracy, and demand reform.

Demand Corporate Responsibility.
Our National Economic Strategy will make large corporations accountable to the American people and provide incentives for entrepreneurs and small businesses, which create most of the jobs in our nation. We will:

Ensure tax fairness by cracking down on foreign companies that manipulate our laws to evade taxes. Eliminate deductions for companies that ship American jobs overseas and reward outrageous executive pay.

Encourage private investment with tax credits that reward companies that make long-term commitments to new business, and reward those who invest in research and development.

Open up world markets by passing tougher trade legislation, creating a national Economic Security Council and stopping our trade representatives from cashing in on their contacts when they leave government.

Ensure worker retraining by requiring every employer to spend 1.5 percent of payroll on training for all workers -- not just executives.

Reward Work and Families.
Our National Economic Strategy will put people first by rewarding work, demanding responsibility and ending welfare as we know it. We will:

Make welfare a second chance, not a way of life by scrapping the current system and empowering those on welfare by providing the education, training and child care they need to go to work.

Reduce the middle-class tax burden by giving working families a choice between a children's tax credit and a rate cut -- and pay for it by making the rich pay their fair share.

Expand the Earned Income Tax Credit so that no one with a family who works full time has to raise children on poverty.

Sign the Family and Medical Leave Act to give American parents the right to 12 weeks of unpaid leave to care for a newborn or a sick relative.

Break the Washington Stalemate.
No plan to put our people first, no strategy to make the economy grow, can succeed unless we break the stalemate in Washington. It is time to cut the bureaucracy, limit the special interests, stop the revolving door and cut off the unrestricted flow of campaign funds. We will:

Cut 100,000 unnecessary bureaucratic positions through attrition and mandate 3 percent across-the-board savings in every federal agency.

Eliminate taxpayer subsidies for lobbyists and special interests. Toughen and streamline disclosure requirements.

Reduce the White House staff by 25 percent, and challenge Congress to do the same.

Stop the revolving door from public service to private enrichment by requiring senior Administration officials pledge never to become registered agents for foreign governments, and challenging Congress to do the same.

Enact strong campaign reform legislation that caps spending on Congressional campaigns: slashes political action committee (PAC) contributions to the individual legal limit of $1,000; and lowers the cost of air time so that TV becomes an instrumentation of education, not a weapon of political assassination.

If you're ready to put people first, join our cause.

Only it is actually a brochure of Bill Clinton's, from his 1992 campaign. 

[Simmer]

In the aggregate it was, although I'd say now it has turned positive.  In fact, I'd say that's what folks like Eli and ADC were arguing above - an additional dollar of disposable income will be saved and not spent on consumption.

I was lost once you guys started adding up letters.

Seriously... Those two are awful, awful spellers.

( . )( . )

_______

   8==D~

MODS!!!!!!!

[Chuck to Chuck]

The problem is that rich people slow their spending after a certain point.

When well-to-do people get more money, it usually sits there on top of the pile.  If someone has $250 million in the bank, are they really going to go on a spending spree because they just grabbed another $2 million? 

But they're not putting $250MM in a savings account or into their mattresses.  Where do you think they're putting this $$?

Probably wherever it can best trickle down to the needy, right?

Absolutely.  If it's in the capital markets, it might be so a company can expand and add new jobs (good jobs, too).  Or it could be in the credit markets, where $$ are desperately needed so companies that need credit to keep their doors open can meet payroll.  Or it can be spent in the form of charitable giving, which apparently only bleeding hearts engage in according to DeJesus.  Or it can be spent on a couple more cars, (maybe even American cars if the domestic automakers built anything worth buying) or another house. Hell, it could even be used to overpay for a National League Franchise and a 94-year-old building.

C+I+G=C+S

C is on both sides, so...

I+G=S

G is ideally 0 because, if budgets are balanced, G=C-t.

Therefore, S=I.

Savings = Investment.

Savings is good.

*Putting on Macroeconomist's hat*  I'm not sure what you're showing here, Chuck.  These are the national income accounts as I know them.

Y = Output
C = Consumption
G = Govt Spending
I = Investment
T = Taxes
       
Y = C + I + G (we will ignore trade here, speaking simply about national income accounts)

Rearranging,

Y - C - G = I

Adding in taxation, which is just a transfer from the private to the public sector:

(Y - T - C) + (T - G) = I

The first term is "private saving" and the second is "government saving" in that iteration.  The sum of those is just "saving."

S = I

That class blew pays my mortgage.

Me'd

[Eli]

Lindsay Lohan, excited about Barack Obama:

"It's an amazing feeling. It's our first, you know, colored president," the 22-year-old actress said in response to a question from Maria Menounos on "Access Hollywood" about her reaction to Obama's win in the 2008 presidential race.