The KGB Oracle Forums General Public Discussion (PUBLIC) The Pub Holrom's Video Message to Former KGB Shadowbane

Well, since the vast majority of folks in this country have no savings and live hand to mouth, I'd say that both monies are going to be spent, and probably before they've even been earned.

I want to scream every time I hear some news caster play a clip of Pelosi saying this. It is ludicrous. The idea that you can take $1 out of the economy via taxes (take it out mind you, not create a new one to add in) then give that $1 to some one who didn't earn it, and their spending of said dollar creates $2 (actually the claim is $1.66 but that's too many numbers for us dummies so I really appreciate Nancy rounding that off for us) of economic growth is mind boggling.

But, for argument's sake, let's throw logic out the window and use some of the administrations own people to refute this claim. Let's assume that for every $1 of unemployment the economy grows by $2. Christina Romer and her husband, also a Berkley economist, wrote a research paper entitled, "The Macroeconomic Effects of Tax Changes" just six months before her appointment to chair Obama's Council of Economic Advisers. In this paper they conclude, at odds with most traditional Keynesian (he's the nut ball who pioneered the idea that government spending is always good for the economy and that debt, while bad for the individual, is great for a government) analysis, that the tax multiplier was 3 — in other words, that every dollar spent on tax cuts (this phrase kills me) would boost GDP by $3. This would mean that the tax multiplier is roughly three times larger than Obama's advisors assumed it was during their policy simulations, and 1.5 times higher than all of the sound bites we've heard lately.

Which is better? You decide.

Oh, and actually that $1.66 is supposed to be representative of the economic growth associated with government spending not unemployment benefits, although I can see how one could fail to make the distinction between the government taking money from group A and giving it to group B and the government taking money from group A and giving it to group C. Oh, I guess I too can see why they don't bother making the distinction.

Dollars spent on tax cuts This is the terminology that is used by the government when describing tax cuts. Don't words have meaning anymore? How can you spend a dollar that you haven't confiscated yet? Tax cuts are not government spending. Its just a decrease in the amount they take from you each year. Now, some might read this post and assume that I am completely against all taxes. I assure you that I'm not so ignorant as to assume that the government doesn't need funds to function. However, I do think that over 50,000 pages of tax code is ridiculous. Hell, even the former chair of the House Ways and Means committee (the one that writes the tax code) apparently couldn't understand it, thus yesterday's censure of Charlie Wrangle. Oh, and if you want to experience real hopenchange, I suggest forgetting to claim income from your vacation home in the islands (don't have a vacation home? Neither did he before he was a Senator. That must be a great job) for 17 years. Let's see if they only censure you, or if, like Wesley Snipes, you get to face hard time.

I maintain that any money spent by a private citizen is a much better investment in our economy than a politician confiscating it and then doling it out for political favor with various constituencies to win an election. In the absolute best case scenario, taking $1 from Bill and giving it to Tom generates the EXACT same amount of economic stimulus. Unfortunately this isn't the case because at the very least they have to deduct the salary of the bureaucrat whose responsibility it is to dole out the confiscated riches. The truth is that this is all a big shell game and an attempt to get more of the "I don't know, from his stash" people out to vote in two more years, all while pompously declaring "if it hadn't been for us, the world would have ended."