I just heard this nonsense on Hannity.

Gohmert wants to use the remainder of the $700b bailout money to give the US a 2-month tax holiday so that we won't be paying off bank CEO's. Or something.

I agree somewhat with his sentiment, but the entire premise of a "People's Tax Holiday" is flawed. Suspending a progressive tax is inherently regressive. If we're going to do demand-side stimulus, why not just have another flat rebate check? Imagine if we turned 2 months of progressive tax into a flat rebate. That would certainly help the average person.

Please tell me this isn't gaining traction outside of wingnut land.

12/2/2008 6:55:29 PM

I doubt Gohmert has thought of the nature of taxes and how it relates to a plan of boosting consumer spending.

But, for many reasons, I don't see it gaining traction.

Although I would like to see more of the bailout, if it can't be reduced to just banks, go to help more Americans.

12/2/2008 7:09:59 PM

We need a good bit of keynsian spending in America.

12/2/2008 7:25:19 PM

I agree, but why use a regressive two-month tax cut?

What about public works? The governors were complaining about that just today.

12/2/2008 8:52:18 PM

Tangent...

Local politicians are going to have a brain hemorrhage if the gas prices stay low long enough for the gas tax to be readjusted back down.

12/2/2008 11:03:03 PM

this is the equivalent of not paying your credit card bills for two months. good message!

12/2/2008 11:12:57 PM

^

12/3/2008 9:55:05 AM

Quote :

"Tangent... Local politicians are going to have a brain hemorrhage if the gas prices stay low long enough for the gas tax to be readjusted back down."

gas is taxed per gallon.

12/3/2008 10:00:28 AM

so boone you are against people keep more of what they earned and in favor of just handing out money to people who didnt earn it? Just asking

12/3/2008 10:12:32 AM

I actually favor this plan.

Quote :

"this is the equivalent of not paying your credit card bills for two months. good message!"

is not a fair assessment. paying credit cards is money going towards something already owed. in this circumstance it would be more akin to not paying a tip and getting dessert instead. I say this because the money has not yet been spent but has only been set aside to do so. thus the amount of money to be spent has been accounted for the only question is how to spend it. once again this differs from the credit card situation because payment of credit cards is a necessity to pay whats owed on money already spent.

[Edited on December 3, 2008 at 11:27 AM. Reason : engrish]

12/3/2008 11:26:12 AM

Paging Dr. Smith...

12/3/2008 1:47:13 PM

Quote :

"against people keep more of what they earned and in favor of just handing out money to people who didnt earn it?"

Taxes are a very dear and precious thing to politicians.

The last thing they want is for we Americans, for two months, to feel the release of the gov't's sucking tube removed from our arteries. We might enjoy the feeling. We might start questioning the need for shoveling over a third or more of our income to the gov't.

No..I don't envision anything with the words "tax" and "free" making it to a vote.

12/3/2008 7:17:15 PM

well, setting aside the Randian soliloquies...

I really don't see how this solves anything when the most egregious shortcomings that can absolutely be fixed right now will involve federal taxes, those improvements primarily being infrastructural in nature.

12/3/2008 11:18:59 PM

I agree earthdogg.

12/4/2008 9:15:10 AM

^^why should these changes not be performed by the states?

12/4/2008 9:57:17 AM

most of the states are already damn near bankrupt?

12/4/2008 11:43:20 AM

YOU CANT HAVE YOUR CAKE AND EAT IT TOO!!!!!1

12/4/2008 12:46:40 PM

Quote :

"most of the states are already damn near bankrupt?"

this would differentiate them from the nation how exactly?

12/4/2008 1:39:22 PM

Quote :

"YOU CANT HAVE YOUR CAKE AND EAT IT TOO!!!!!1 "

typical joe

12/4/2008 2:49:44 PM

Quote :

"this would differentiate them from the nation how exactly?"

entities/countries are still willing to lend the country money.

12/4/2008 2:53:28 PM

is he suggesting taking a 2 month tax holiday for all federal taxes or just income and coorporate taxes?

I think a better suggestion would be to not let the feds SPEND ANY money for 2 months, except on military.

12/4/2008 3:04:37 PM

Quote :

"I think a better suggestion would be to not let the feds SPEND ANY money for 2 months, except on military."

why does the military get a special exemption?

is it more important than medicaid?
is it more important than education?
etc etc

and like it or not, many jobs are tied up with federal spending. do we want even more people to be out of work?

12/4/2008 3:09:00 PM

Quote :

"I think a better suggestion would be to not let the feds SPEND ANY money for 2 months, except on military."

Ceasing government spending during a severe recession? That's just about the worst possible scenario I can think of.

While we're at it, why don't we reenact the Smoot-Hawley Tariff just to be absolutely sure we fall into a Depression?

12/4/2008 3:37:48 PM

Quote :

" entities/countries are still willing to lend the country money. "

No not really. We have shown that we (the us government) can't pay our bills and that our economy and financial growth may not be the rock solid sure fire bet the world always thought that it was. thus they are more hesitant to lend us money, especially given the fact that they have their own crises and stimulus packages with which to deal. Your statement would have been closer to correct if you said "the US is still willing to print money". Then i could some what agree with you.

Furthermore using the fact that the federal government can borrow money from foreign powers as a rationalization is rather poor as that is not a solid fiscal policy on which to act anyways.

12/4/2008 4:46:26 PM

Quote :

"why does the military get a special exemption? is it more important than medicaid? is it more important than education? etc etc and like it or not, many jobs are tied up with federal spending. do we want even more people to be out of work? "

Because national defense is actually the JOB of the federal govt.

While its impossible for them to not spend a dime AT ALL for two months, my point is we have to rein in spending. And yes laying off people in the short term is a helluva lot better than just printing money out of thin air to hand out ot everyone with a sad story or a shitty business plan. imo

12/4/2008 5:10:59 PM

Quote :

"While its impossible for them to not spend a dime AT ALL for two months, my point is we have to rein in spending. And yes laying off people in the short term is a helluva lot better than just printing money out of thin air to hand out ot everyone with a sad story or a shitty business plan. imo"

but history says the opposite.

[Edited on December 4, 2008 at 5:21 PM. Reason : at least to the gov't spending during a recession]

the real problem was the excessive deficit spending and tax lowering during good times. deficit spending is for the lean times.

[Edited on December 4, 2008 at 5:22 PM. Reason : .]

12/4/2008 5:20:30 PM

Quote :

"Because national defense is actually the JOB of the federal govt. While its impossible for them to not spend a dime AT ALL for two months, my point is we have to rein in spending. And yes laying off people in the short term is a helluva lot better than just printing money out of thin air to hand out ot everyone with a sad story or a shitty business plan. imo"

google ron paul

I'm guessing you meant to include medicare and social security in this. And federal highway projects under construction currently.

not to mention that right now federal projects are some of the only ways many companies will be getting any orders whatsoever for production (think of highways: concrete, steel, engineering firms, etc). what you're proposing is purposefully instigating shooting unemployment even higher in hopes that people are gonna just bootstrap themselves up and find some new way to make money for the duration of this downturn (b/c we aren't gonna be spending on the increased unemployment insurance if we are drastically cutting spending either).

[Edited on December 4, 2008 at 6:07 PM. Reason : .]

12/4/2008 6:01:55 PM

We should invest $700B in public transit.

12/4/2008 10:28:21 PM

^

12/4/2008 10:29:07 PM

Oh yea, and we need to spend some more billions on communications infrastructure, ie high-speed broadband to every home. Something like the Rural Electrification Administration.

12/4/2008 10:37:35 PM

^^^ & ^these are not the job of the federal government, but, rather, the job of the states. if they wish to do it in their communities, a group over which they actually have jurisdiction, then so be it. but the government shouldn't be held responsible to handle this. hold the federal government responsible for situations such as this leads to a further restriction of states' rights due to increased reliance on government funding and by being more or less held hostage by promises of money. I agree the trillions (yes with a t and yes with a s) in bailout money should go to the states before they go to these private industries; however, they should only go to states without orders and direction of how it should be spent and without the political mau mau that creates a concession of states rights as a consequence of accepting the funds. Funds, mind you, which came from the taxes of the citizens and therefore belong to them and by extension the states, anyways. However, before the money should go to the states the money should go back to the people, if it is there to spend. A good way to do this would be the tax holiday indeed.

12/5/2008 9:33:32 AM

do you understand the point of government spending during a recession?

12/5/2008 9:59:56 AM

Believe me, I'm very sympathetic to the issue of states rights. However, it is impractical to think that we can put the cat back in the bag. It is also foolish to fail to act based on some conceptual, idealistic idea of how things should be. Do you really think we'd be better of with 50 states going in 50 different directions, or with coordinated federal action?

That being said, I do agree that some money should be given to the states to prevent them from having to drastically reduce spending or drastically increase taxes, deepening the recession.

[Edited on December 5, 2008 at 10:25 AM. Reason : ?]

12/5/2008 10:24:59 AM

yes, i do understand the point. I take it that while you may think that you understand the situation you truly only have knowledge of the issue and thus the basic points of it seem appealing to you while both the fundamentals and negatives are being lost on you which prohibits you from seeing other alternatives.

Governments spend more during recessions and deficits increase during them for a few reasons. The short answer for the increased spending is to stimulate the economy. This is often times done by new creation of government programs (see new deal) to support those in need and also provide additional income to those who may be affected through job creation. The primary reason that deficits grow is that a larger pool of people who need to take advantage of both the initial social programs and the new social programs forms. Both of these measures create huge deficits that have to be addressed and paid by all while not everyone sees any direct benefit from these efforts but all states do see a direct concession of their rights and powers in regards to the governance of its statesmen by becoming indebted to the federal government.


Now, allow me to explain why this particular situation is different than most and why a tax holiday would be warranted.

We have allocated trillions of dollars to go to companies who in some cases are responsible themselves for the situations in which they have found themselves, rather than it being the direct result of the recession. These bailouts also do not directly benefit any of the citizens who pay the taxes which will fund these bailouts. These bailouts may not actually stimulate the economy, which is the sole purpose for the recessionary increase in spending, as was stated addressed earlier.

In contrast to the measures above and to creation of new programs a tax relief holiday would directly benefit all citizens of the united states and would stimulate the economy. All people with jobs would have more financial means with which to comfort themselves in the style of their choosing. The style of their choosing is key, because that is a large aspect of 'freedom'. However, the absolutely key benefit of such a plan is the direct impact on everyone and the increased likelihood of economic stimulation. Furthermore job creation would also be impacted through the increased spending as well as the more secure financial position in which companies would find themselves through the increase in financial means with which to grow due to the moratorium on taxation. The desired outcomes of increased government spending would be met more directly and efficiently as well as at no cost to the freedoms of the states.

Given that we already have trillions allocated to spend and thus have committed ourselves to a reduction in the coffers of treasury by this amount then we also have the capability to execute the use of these funds as a more limited, acute and direct solution as opposed to any programs or bailouts with which we would have to keep supporting with additional funds in hopes that it would meet our expectations.

Quote :

"Do you really think we'd be better of with 50 states going in 50 different directions, or with coordinated federal action?"

That depends on the exact meaning of your question. if its limited to the recession, then the answer is an emphatic yes. If its in regards to the possibility of systematically reducing the control of federal government as a whole and the forward direction of the entire nation with all 50 states acting as individuals, then maybe; although, i'm not entirely sure all 50 or even a large portion would go in drastically different directions. This tangential conversation would be best suited for another thread or perhaps this one once it sort of dies down a bit.

Anyway, I digress. As I said above, yes I believe that we'd serve better from all 50 states acting independently in this time of crisis. Why? Because who better to know the needs and solutions to fix the problems within their states than those most closely associated with them, those being the state government and the local principalities.

Not all states are suffering from the exact same issues, and since their conditions are not necessarily the same as another state 3000 miles and many socioeconomic conditions away then the same solution may not necessarily apply. Even in the best case scenario for federal government intervention for the states by means of input of states to the federal government as to how their particular situation would need to be handled the state would remain at a loss because the same idea could have be implemented through their own evaluation but now they have to pay the washington brokerage fee.

Given that each state would have the solutions most tailored to their particular situation and that the funds they would have would be more beneficial since it would not have from it removed the washington brokerage fee, then, once again, yes, i believe all 50 states taking whatever direction they decide would be the best laid plan.


[Edited on December 5, 2008 at 10:57 AM. Reason : .]

12/5/2008 10:46:26 AM

but this is not just about fixing the specific problems of the states. it's about a national and international recession.

12/5/2008 12:55:35 PM

i think that much we can agree on, but you've either missed the point or have chosen to ignore it or you just didn't really read it and compare to what we've been discussing in relation to the topic because my post was so long. i believe the latter because i know you're not that dumb.

I'll sum it up and perhaps that'll help you better focus on the point at hand.


Its a national recession, yes. A nation is a series of states. A nation excels if all the states succeed. If you can get economic growth to occur for those in the states then as a result the national economic scene will see benefit as well. Do you agree or disagree with this point of fact? If you disagree with it then why so? Please explain for me a situation in which that would not take place; one where all states are prospering economically and yet the nation fails to do so*. Then please explain to me how in that scenario a series of bailouts or a government program would achieve the desired goal better and in an equally cost efficient manner. Feel free to use points from my previous post to contrast the benefits seen from either one of your positions rather than the blueprint i laid out in the post above.

*you might suggest that there are no taxes and therefore the nation would not be able to prosper if all states were not paying taxes. I would like to point out ahead of time that this is mere sophistry as the taxes would only be withheld for two months (which in reality would be a lower net cost than the proposed financing for the bailouts which equates to an entire fiscal year's taxes as of current) which would not be an amount so substantial that it would prohibit the government from functioning or taking care of its current duties. As it stands trillions have been allotted so therefore we can take that as the amount of money the government feels as if it can spend and still function at normal.





.

12/5/2008 4:43:42 PM

Rep. Gomer's Two Month Tax Holiday: Shazam!

12/6/2008 7:41:11 PM