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« Deconstructing Obama and Journalism | Main | Public Service Pension Sticker Shock »

09 April 2011


Dixon Cruickshank

The old Free Ice Cream for everybody line - good piece George

I did see where his budget does increase debt or spending by 7 Trill not sure the date but the alternative is mind boggling but you have to start somewhere, of course most of that is debt service already accured. Any cuts will be met the same as in WI and it won't be easy dragging the union/progressives back from the brink but it appears the country is ready.

Todd Juvinall

I remember when Bjorn Borg was the greatest tennis layer on the planet. He was making a gazillion bucks a year. He was a Swede I think. Anyway, if I am recalling correctly he left Sweden and became an American. Why? Tax rates. In Sweden the rate was something like 95% whereas here at the time it was 39% or some-such.

The Ryan budget still has massive debt and I would rather take the hit to balance it in one cycle. Sort of like yanking the bandaid off your arm very quickly to shorten the pain. We will see.

George Rebane

Meanwhile, comments for my column on the Union's website are the usual wild and woolly. All demonstrate that their reading comprehension skills are a notch or two below their writing skills. Here's an enraged sackhead named "hatsincloset" -

7:26 AM on 4/9/2011

Rant Rocket Rebane- At it again.
Hard to know where to start with you, Jorge. But, to put in bluntly your an idiot when you think you can load ALL taxes on the middle class. They will come for you in the night Jorge, and it wont be pretty. When the Koch Brothers finally get our last dime, were coming to your house.
Oh and Jorge where the hell are the jobs? Oh yeah you jerks think when you have cut the budget down to $.50 that jobs will appear as if they were dropped out of the Space Shuttle -- Put your tin foil hat back on --- Jorge-

The personal threats I take very seriously.

Reich published his ideas on taxing the super-rich in many media outlets; here's one -

in which Reich states, "And yes, some of the super rich will move their money to the Cayman Islands and other tax shelters. But paying taxes is a central obligation of citizenship, and those who take their money abroad in an effort to avoid paying American taxes should lose their American citizenship."

Todd Juvinall

I think that letter writer is Kate Hancock, a leftwingnut poster from the leftwingnut's blog. Sounds too familiar.

Paul Emery

I think we should listen and enlist all the Clinton-Newt era Republicrats that we can muster up. The indeed did provide a balanced budget. The worst administrations for debt increase, not including Obama who may break all records were Reagan and Bush 2, both of which included tax cuts for the wealthy that led to massive debt. Also, job growth slowed remarkably under Bush 2 after the tax breaks for the swells.

Ryan's budget plan relies on economic forecasting from the Heritage Foundation's Center for Data Analysis. To use the Heritage Foundation as an unbiased source of research on the economic effects of the 2012 budget cannot be taken seriously. It is a respected conservative think tank no doubt but not without it's bias and slant. It's pretty silly that it was even included as a major source of analysis knowing that it would not hold up as the main source of analysis.

George Rebane

And the main respected unbiased source of analysis - the envelope please?

Todd Juvinall

Yes Paul, who are those experts you want to tell us about?

Paul Emery

The point I am trying to make is that if this is a serious attempt to garner public support for a major policy shift the proponents need show they have considered and analyzed several credible points of view then present this as a good faith effort at coming up with the best solution to what is a serious problem. The credibility of this budget cannot be taken seriously until it does and believe me the Democrats will exploit this as being shallow and philosophical without credible substance. For example, please show me the historical basis for concluding tax cuts lower the deficit? I don't see it at least looking at Bush and Reagan. Help me with this for a start.

Dixon Cruickshank

Paul I wouldn't trust the current Gov to make correct change for a beer. I presume you might be referring to the OBM, have you looked at the future growth rates that the Gov is producing? they look kinda like CALPERS Investment Return models - a teensy high maybe.

The reason Clinton looked so good we were already out of the recession by the time he was elected - the 4th quarter growth number may still be the highest in history. If that number had already been produced Bush would have continued as President. Clinton couldn't have looked bad if he tried but he wasn't bad.

George Rebane

Paul, before we again go chasing topic after changed topic over the countryside, I take your response to mean that there is no more or less credible, unbiased, etc source of analysis than the Heritage Foundation.

Dixon Cruickshank

BTW that Kate H ( hats) sounds a bit like that school teacher in WI - a bit unstable and real scary. I have wished many times I could respond to her rantings and jibberish

Paul Emery

You're asking me a leading question , an old debate trick. A leading question is a question that suggests the answer or contains the information the examiner is looking for. Whatever
The Brookings Institute for one. They are probably as liberal as the Heritage is conservative. I have no problem with the Heritage Foundation for what they are. I recall a few months ago when I was bugling Denmark and I used the Heritage gushing of Denmark's quality of life and economy to illustrate my point that life was pretty good over there.

Again what I'm most interested in knowing is what historical basis is there for the assertion that cutting taxes on the wealthy will lead to deficit reduction? That's a major assumption in Ryans budget and I'm scratching my head over that since it certainly wasn't the case with Bush 2 and Reagan, two notorious deficit multipliers.

Russ Steele

Paul, you are looking at only one factor. Here is an analysis by the CATO Institute: Supply-Side Tax Cuts and the Truth about the Reagan Economic Record.

Executive Summary
Bob Dole's proposal for a 15 percent income tax cut has reignited the long-standing debate about the economic impact of Reaganomics in the 1980s. This study assesses the Reagan supply-side policies by comparing the nation's economic performance in the Reagan years (1981-89) with its performance in the immediately preceding Ford-Carter years(1974-81) and in the Bush-Clinton years that followed (1989-95).

On 8 of the 10 key economic variables examined, the American economy performed better during the Reagan years than during the pre- and post-Reagan years.

• Real economic growth averaged 3.2 percent during the Reagan years versus 2.8 percent during the Ford-Carter years and 2.1 percent during the Bush-Clinton years.

• Real median family income grew by $4,000 during the Reagan period after experiencing no growth in the pre Reagan years; it experienced a loss of almost $1,500 in the post-Reagan years.

• Interest rates, inflation, and unemployment fell faster under Reagan than they did immediately before or after his presidency.

• The only economic variable that was worse in the Reagan period than in both the pre- and post-Reagan years was the savings rate, which fell rapidly in the 1980s. The productivity rate was higher in the pre-Reagan years but much lower in the post-Reagan years.

This study also exposes 12 fables of Reaganomics, such as that the rich got richer and the poor got poorer, the Reagan tax cuts caused the deficit to explode, and Bill Clinton's economic record has been better than Reagan's.

The complete report report is here.

Account Deleted

Paul asks "Again what I'm most interested in knowing is what historical basis is there for the assertion that cutting taxes on the wealthy will lead to deficit reduction?" There aren't any Paul, because you have confused 2 different functions. It's like asking if there is proof that an increased income guarantees increased savings. The problem with the left and the Dems is that they got their view of economics from the Disney cartoon books. They think the "rich" have a big vault of cash and wallow in it. They don't have any real use for it and so the best thing to do is have the govt take it from them and "invest" in the economy. In reality, the govt just fritters it away on cronies in the unions and suck-up researchers that produce little or nothing for what is spent. The sad fact is that many left wing wealthy (movie stars and such) pretty much do blow their money and have no idea what to do with it. But most of the wealthy in the world make the money work. They invest it with producers that multiply the money and provide good jobs. If you start taxing the rich at high rates, they will: 1 - not produce as much wealth,
2 - have much less wealth to invest in real growth for the economy, 3 - find unproductive means to bury their wealth. Or a combination of all 3. Lowering tax rates to a reasonably low level will tend to increase actual tax revenue. This is proven fact. China, Russia, America, everywhere. The govt operates on actual amounts, not rates. There also needs to be a favorable climate for business growth, with reduced onerous regulations that make it increasingly more expensive operate a business and hire workers. You can lower tax rates alone, and it will not do much good at improving the employment picture. The Dems know this and constantly hammered the Rs trying to work on the EPA and the unions as "distractions" that should be separated from the budget talks. They are part and parcel to the whole picture. Then there is the govt.s budget and expenditures. Even if the tax rates go down and the job growth goes up, and the economy picks up, and the tax receipts go up, if the feds still spend as they normally do, then deficit still gets worse. There needs to be a whole package of: tax cuts, reeling regulations back to where they actually can pay benefits to the economy, re-establishing something resembling a free market, and a federal govt following the spirit of the Constitution and then we will have a growing economy. Anything less in this country will result in a downward spiral. We need to reward producers - not punish them.

George Rebane

Paul, I can't add anything to what Russ and Scott have so well appended here.

Deficit = Spending - Revenues

When spending increases outpace revenue increases due to salutary tax policies, the deficits are positive and may also be increasing. This is a tenet rejected by the left.

And about the debating point - it was you who implied the existence of more credible and unbiased sources, the name of one of which you supplied that doesn't come closer to satisfying the specification any more than, say, Heritage, Cato, Hoover, American Enterprise Institute, etc.

An attribute of soft socialism is Keynesian spending. Attributes of strong socialism are firm beliefs in a fixed pie, government is the prime pie grower, and it grows it faster the more it can tax. These beliefs are all on display here and in today's debate.

Bob W


Is Hatsincloset a friend of yours?

Paul Emery


I don't know who that is by the name. I hate fake names.

Russ, Scott

Thanks for the thoughtful response to my question. Whatever the conditions it remains a fact that the deficit grew by leaps and bounds under under Reagan and Bush 2 so to me it makes sense not to trust the philosophy and experts they employed . To me Reagan and Bush were irresponsible if they did not cut the amount of expenses equal to the tax cut.

Russ, well articulated redo of trickle down economics, Reagan's trademark.


When you ran a business and you needed top make a major decision and you solicited opinions to solve a problem did you seek a variety of views? There are many sources of economic opinions that Ryan could have sought instead of relying only on the Heritage. What's wrong with seeking varied opinions? I never had a problem with the credibility of the Heritage Foundation. They are a predictable conservative think tank that would likely agree with conclusions that were predetermined. Historically, conservatives have no experience in balancing the budget. They need to enlist the Clinton crew to show them the way

Bob W

Agreeing with conclusions that are predetermined indicates credibility? I bet you do know Hatsincloset!

Account Deleted

Paul - Tax receipts went up under Reagan, but spending went up even more. I'm not sure why you think there is some kind of linkage. They are not automatically connected. There are several components to balancing a budget. The left has no clue, obviously. If Reagan had been given a blue pencil, there would not have been deficits in his terms. The long term problem debt problem started decades ago with SS and Medicare. Any president or other politician that seriously attempted to address this issue was thrown on the bonfire.

Todd Juvinall

The childish Steve Enos, BAJA on the Union comments, has started spamming my blog. This guy is a little child. So, watch out, the baby may come here next.

Paul Emery


So called think tanks have inherent prejudice in my opinion. They may reach credible conclusions, within their dogma none the less. In this situation the Republican agenda is to balance the budget with the proposed spending cuts, and stimulate the economy with tax cuts and it's all supposed to pencil out. The Heritage foundation supporting the Republican agenda at least within that arena gives the Repubs some kind of credibility they can hand their hat on even though, in my opinion, it's the cart following the horse . The question is whether they can sell this to the American people. Turning Medicare into an insurance voucher will likely go over with a thud once in's brought into the sunlight. The Dems can't wait to dig into this one. Just like Bush 2's ideas on Social Security. Boy, that was a bad idea that had a quick arc.

Jo Ann Rebane

Paul, Didn't Congressman Ryan take much of the 2012 budget proposals from the President's own bi-partisan Debt Commission? That's the same Debt Commission that the President and the Democrats have ignored.

Account Deleted

Paul, since almost everything I read about Bush's plan for SS was a left wing lie, I would be fascinated to hear you explain what Bush's "idea" was. Since you indicat4e you already know what it was, you won't have to do any research. Please, sir, explain.

Account Deleted

Whoops - indicate.

Paul Emery


Bush's ideas? Sure. In a nutshell. Lower taxes, same or increased spending. Remember, Bush came into office with a healthy surplus which he returned to taxpayers rather than pay down the debt.

We had a growing national debt from 2001-2008 due to lower taxes and the same budgeted spending as under Clinton. Add a couple of unfunded wars and you've got the numbers.
These numbers came from from the Congressional Budget office

Budgeted spending 19.9% of GDP, similar to President Bill Clinton,

Tax receipts were lower at 17.9% versus 19.1%.(Clinton)

Apparently Bush thought he could lower taxes and spend hardily damn the consequences.

Might I add that there were much smaller job gains under Bush than Clinton

From the Jacksonville Record Business Journal

"President George W. Bush will leave office Tuesday with the worst employment-growth record of any president since World War II, according to a new analysis by Bizjournals.

The nation’s job base grew at an annual rate of 0.28 percent during Bush’s eight years as president – by far the slowest pace for any of the 11 presidents in the postwar era, according to Bizjournals. Bizjournals is the online media arm of American City Business Journals, The Business Review's parent company.

The previous low had been set by Bush’s father, George H.W. Bush, with an annual job-growth rate of 0.59 percent."

Paul Emery


Sorry, I answered the wrong question. Bush's plan was to allow investment in private investment plans as an option to social Security. The plan ran into trouble almost immediately especially when it became obvious that the government would have to borrow money to supplement the SS fund because of the diminished cash flow with SS payments leaving the house so to speak. The idea went down fast, crashing in about a month. How similar is this plan to Ryans? I don't know but if it is it could suffer the same fate.


I don't have an answer to your question. I'll check it out.

George Rebane

Somewhere in this thread there it should be noted that Bush inherited from Clinton the bust of the dotcom bubble and its recession which was further abetted by 9/11, the instigation of which no doubt reflected the actions and resolve of the US that had been built up during the eight preceding Clinton years. All the liberals like to point out is that under Clinton and a Republican Congress there were two years of surpluses during the dotcom bubble.

A little balance gentlemen, please.

Greg Goodknight

Yes, the nation was just recovering from the recession Bush II inherited from Clinton, in when 9/11 hit and brought us back down again.

The Clinton balanced budget was courtesy of the Gingrich congress.

Paul Emery

You could at least give me credit for this in appreciating a balanced view

"I think we should listen and enlist all the Clinton-Newt era Republicrats that we can muster up. The indeed did provide a balanced budget."

Again to simplify Clinton: -Jobs, surplus, less debt
Bush: Tax cuts-few jobs more debt

Of course you can get into the making of the sausage but this is the scorecard.

In retrospect, if Bush used the surplus to bay down the debt or keep on hand for emergencies such as 9-11 and not issued a tax cut we would have been fine but that's not what he did and it was during a Republican Congress.

Also Reagan and Bush 1. Our debt increased by 35% during their 12 year tenure so why should I trust conservatives to do the job.

Account Deleted

Thanks Paul. You actually have it pretty correct as you at least indicate that it would have been voluntary. The print and electronic media usually used the word "forced". The part about SS needing to borrow money was the joke as it's going to have to be subsidised heavily by the general fund anyway. As time went by, fewer people would be dependent on SS and the whole thing would diminish down to nothing. The left wants folks helpless and dependent on the govt and wants to have the slush fund to use as a prop for the massively unsupportable govt programs. Your simplistic and false equations of Bush and Clinton are a joke. You really need to brush up on your civics. The presidents are not dictators. There was so much at play in those decades that you completely overlook. At the time Clinton was in office, he had the luxury of massive amounts of capital gains taxes pouring in from the dot-com boom. He gutted the military and helped push through NAFTA and welfare reform. Bush had to pay to re-build the military and the other 2 are conservative, and free market ideas. I would have to research the details, but I remember that Clinton also set up a lot of expenses to be paid later in the next admin. He inherited a pretty good economy and left as the stock market tanked all summer and fall. His handling of the dot-com bubble was to shove a nail in it with the most idiot of all legal actions against American free enterprise when his justice dept went after Microsoft because they would not come up with the money for bribes, er "donations" that were expected from a wealthy company. You won't get any difference of opinion from this blog on Bush jr's spending. But again, you have linked income and spending in some kind of bondage that you have yet to explain. The greatest increase in "Bush" spending came from the 2 years of the Dem controlled legislature. Why don't they count? And the Dems current spending is so out of control, it's not even funny. Barry has come up with a novel plan - "Hey - let's raise taxes". Out of control addicts. There will be one heck of a fight coming.

Paul Emery

Thanks Scott
When you say
"Your simplistic and false equations of Bush and Clinton are a joke." I refer you to GR's simplistic formula
"Paul, I can't add anything to what Russ and Scott have so well appended here.
Deficit = Spending - Revenues

Assuming the military needed rebuilding under Reagan and Bush what plan did they have to pay for it other than go into debt?

You can blame it on whoever you like but it's a Presidents job to show leadership. When it became obvious to the Bushes and Reagan that they were unable to control spending for whatever reason they should not have pushed tax cuts knowing that would lead to massive deficits. Instead they plowed forward knowing they would blame the Democrats.

I can't argue about the current level of spending. I'm just trying to point out that historically Conservative administrations have a poor record when it comes to the national debt. Reagan-Bush Sr admins were the worst (+35%) but Obama may soon catchup. The numbers speak for themselves on this one. If Reagan was a great president why did he allow this to happen on his watch?

Wiki has the chart based on CBO numbers.

Account Deleted

OK Paul, lets use your formula - That would put Obama so far behind Bush it isn't funny. Obama has already blown the debt past everyone in his first term. And he promised to cut the deficit in half in his first term.
Now, let's elevate things a bit. If you want budgets, revenues and taxes like the Clinton era, there will have to be some changes. First, you will have to get cuts to the budget that will put you to the right of the Tea Party. I haven't heard you call for that, so I'm not sure how this part will work. Next, you will have to arrange for a whole lots a folk to stop shooting at each other. Good luck with that. Now - and this is the hardest part, have a complete revolution in tech that has not been seen since the industrial revolution come along and mostly happen in this country. And you think it will magically happen if the right bunch of bozos are pushing the buttons and pulling the levers in DC. At this point, I'm afraid we are at an impasse. You can have your theories and ideas, but I'm watching the debt bomb ticking and I know "taxing the rich" ain't gonna do it because they don't have the money. We build up the govt or we build up the private economy, take your pick. We have run out of borrowed money to do both.

Dixon Cruickshank

Excellent point Scott:
Now - and this is the hardest part, have a complete revolution in tech that has not been seen since the industrial revolution come along and mostly happen in this country. And you think it will magically happen if the right bunch of bozos are pushing the buttons and pulling the levers in DC.

They got the right guys - ITS GREENTECH - you bozo - how could you miss this. Didn't you see where the homeless will live under the solar panels and turn them. They also can do a winshield at a stop light so solar panels that don't drive away should be a piece of cake. The new Green Tech jobs program in CA schools should provide a steady new workforce for many years to come, now thats fore thought if I ever saw it.

Scott your behind the times my friend - just say'in

Paul Emery

My plan is very simple

Straight percentage cut to all government programs without prejudice. Do not renew the temporary tax cuts Bush imposed. Eliminate corporate welfare and subsidies to big oil, farm subsidies etc. Eliminate off shore tax shelters such as the ones used by Enron and other corporate pirates. No foreign military adventures without funding in place. Ever hear of the term "War Chest" ?

Account Deleted

As I pointed out Paul, you and I are at an impasse that mirrors the country. You want to merely lower the budget of worthless or even detrimental govt agencies and take more money out of the private sector. We're just on 2 sides of the fence and your way leads to ruin, as our nation's economy will not grow enough or at all to pay for the massive entitlement payments needed in the future. I'm fine with eliminating ALL subsidies, but that is a Tea Party thingy, so good luck with that. Our corporate taxes are among the highest in the world, so eliminating the "tax shelters", as you call them just gets rid of businesses completely. That'll be a big help. And please name the "corporate pirates" along with the details, statutes broken, etc. The part about military adventures sounds nice, but why only the military?
Hey Dixon - we here in Kali-fornia can't bleed to death fast enough. Brown just signed a bill to increase the percentage amount of electron potential sold in the once-golden state that comes from moon beams and pixie dust. They couldn't figure out how we were going to come up with 25%, so they increased it to 30%!!! As the proponents pointed out, this will increase the amount of money going to "green tech". Where does the money come from? Who cares?! Just have the Fed authorise lotsa zeros after a whole number in some one's bank account and off we go!! Of course, rates will have to go up to sorta pay for it all, but that was Barry's plan all along. And I know that driving up costs to live and do business in this state will help even further drive out the producers, and they were all whiny right wing types anyway. It's win, win, win!!

Paul Emery


Before I dive into examples of classic corporate piracy I must refer to a Woody Guthrie lyric.."As through this life I ramble I meet all kinds of men. Some rob you with a six gun and some with a fountain pen." Most corporate piracy is legal enough to be defended with the armies of attorneys they are able to employ. Let's start with AIG ripping off he American treasury through billions of Bush Obama bailouts while paying their execs millions in bonuses. Also include the Banksters, B of A, Morgan Stanley, Wells Fargo etc Include also the S&L rip offs during Bush Sr. And let's not forget Enron. I recommend viewing or reading The Smartest Men in the Room.

Also, check out House of Cards about the Mortgage rip offs
Also Inside Job

Corporate Pirates yes indeed.

Michael Anderson

Paul's on the right track.

As Bernie Madoff said, after learning that his son had hung himself with a dog leash last December, "the entire US gov't is a ponzi scheme."

No truer words were spoken.

Account Deleted

So you claim criminal activity, and back it up with a line from a song. I know that you would never hire a lawyer to defend your self against criminal charges. Just go along with what ever the govt charges you with. Right. What you are complaining about is the govt taking money from you and I at gun point and giving it to folks that made bad decisions. They've been doing that for decades. As long as the left got the money for stupidity it was fine, now you just don't like the stupid people that are getting our money. The Constitution is the law of the land and there is no Constitutional authority for the fed govt to redestribute our wealth. If you don't want to follow the Constitution, I would advise you to stop complaining about the consequences. Let's not forget Enron. I haven't. That was just a criminal enterprise. No one is defending that. Enron was able to prey on the populace due to idiot govt regulations put in place in California. I wasn't aware that the govt rewarded Enron because of their criminal activity. I do remember that when the house of cards started to collapse, that Enron sent Paul Rubin (secty of treas under Clinton, a democrat) to beg the Bush admin to back off. No matter what sort of govt you have, there will always be the Enrons. The whole housing value collapse hurt the country far more than Enron, and we still reward the folks that colluded in falsifying documents. I haven't heard of one single home owner going to prison - have you? Instead, they the govt is trying to reward them. Unlike you, I don't care how much some one makes as to their culpability in crime. There was massive fraud going on in the days leading up to the collapse and everyone knew there was criminal activity, but the only people to try to do some thing were called racist or worse by the left because they wanted all of the guilty parties called to account. We agree on the need for govt to stop rewarding bad behavior, but I'm interested in the root cause.

Paul Emery

Root Cause? This happened under Bush's watch.

" For much of the Bush presidency, the White House was preoccupied by terrorism and war; on the economic front, its pressing concerns were cutting taxes and privatizing Social Security, a government retirement and disability benefits program. The housing market was a bright spot: Ever-rising home values kept the economy humming, as owners drew down on their equity to buy consumer goods and pack their children off to college.

Lawrence Lindsay, Bush's first chief economic adviser, said there was little impetus to raise alarms about the proliferation of easy credit that was helping Bush meet housing goals.

"No one wanted to stop that bubble," Lindsay said. "It would have conflicted with the president's own policies."

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