Tully Mars

Why release a budget that contains nearly no specifics? The only specific I could find after reading through the PDF is to lower the tax rates on the well to do and raise it on the really poor. Right now if you make next to nothing you pay nothing. If you're making over a a certain amount you pay 35%. This plan make everyone pay at least 10%, unless I'm reading wrong. And lower the upper tax bracket 10% down to 25%.

They're going to release more specifics next week, I think. But seriously lowering taxes on wealthy people is still your plan? Have we tried that?

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samcol

Seems like a false opposition to me. They had their chance for lower taxes, a lean budget and a sound economic policy when they controlled the executive, the house, the senate and courts. However, they did the exact opposite and passed the largest budgets ever.

Nothing but hot air from the GOP, but at least they get to pretend they are against what Obama is doing.

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The_Jazz

This is either going to be awesome or stupid. I don't see anything in between. I believe that if the Republicans come up with a good original idea for budget cuts, Obama would listen. He might not agree that it's a good idea, but I think he would listen.

But at this point, they've got a pamphlet. So does Rock City outside Chattanooga. I see them having about the same effect on the budget at this point.

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Willravel

It's a futile attempt to stave off real change in the party.

dippin

this is exactly what I was talking about in the other topic.
You can't cut taxes permanently if you are not willing to cut spending on healthcare, pensions, or the military.

They know that if they run saying that they will do something like that, they have no chance, so they resort to these pieces of fiction.

Of course, this time they claim that the difference will come from those who pay nothing now. But here is the thing: people in the upper bracket make something like 80% of the total income in the US, and are responsible for something like 78% of the total tax revenues. A 10% tax increase on the poorest sections of the population will not in any way make up for a 10% tax cut at the top.

ratbastid

The three-term Congressman then flapped his arms and flew back to Sandusky.

aceventura3

Obama has an uncanny ability to use mis-direction to promote his political agenda. Republicans have virtually no power in Congress and it is tradition that the President submit a budget to Congress for them to act on. So, for Obama to say Republicans have not submitted an alternative budget is an act of brilliance given the fact that he does not want his budget discussed. the failing of Republicans is that they became perhaps unwilling participants in Obama's game.

It is amazing that in the same day the Obama's budget is released projecting economic growth in 2009, he says that we are facing the biggest economic crisis since the depression. Obama supporters and the media just blindly eat this stuff up without question. Gee.

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Tully Mars

I can't for the life of me figure out why the GOP would take the bait and release something their calling a budget. I have no idea how it's a budget without any numbers, but still why not just take the opposition role of battling the ruling parties budget? As of right now they just look stupid. Unless they come out with something fantastic and brilliant then I think they're going to look even more stupid.

Personally I'd like to see them come up with something that cuts some spending and the deficit. I don't see that happening but I don't think Obama's budget does that either. At this point I'm not sure there's a way to do that at all.

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dippin

While his projections might be rosy, this is a lie. The Obama budget projects a decline of 1.2 % this year.

aceventura3

I am not going to expect an apology for being called a lair, nor am I going to even expect a response because I understand the nature of these ad hominem arguments from the left.

Look at his budget, page 132 - Table S-8, here is a link:

http://www.whitehouse.gov/omb/assets...ry_Tables2.pdf

In 2008 they list GDP at 14,281. In 2009 they list GDP at 14,291. That is an increase.

I am not going to call you names or make fun of you, because I know what the problem is. Commonly in the media we are seeing this:



However, there is calendar year and there is the government fiscal year which starts in October.

{added} after looking further I think the difference is in nominal vs. real GDP. The 1.2 is "real", adjusted for inflation. However, the point of my original post stands. GDP is going up according to the WH while they say we are in the worst economic crisis since the depression.

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dippin

Growth in nominal GPD is meaningless and in no way constitutes "economic growth." For nominal GDP to actually go down, real GDP would have to decline more than inflation.

I stand by my comment.

Derwood

oh, the irony

aceventura3

"Nominal GDP growth is meaningless", if true why did Obama include it in his budget?

I think you stated what I wrote was a lie. It is not. Your position is now one of playing semantics. Regardless of inflation (which many dispute the accuracy of anyway) growth is growth.

---------- Post added at 08:43 PM ---------- Previous post was at 08:43 PM ----------

Is what I did name calling, or is it truth?

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ratbastid

I admit, I take a bit of delight that it's the Republicans falling into this trap instead of the Democrats, at long, long last.

Willravel

I'd rather the trap never existed.

It's a damn shame we liberals can't learn to cooperate with the conservatives and visa versa instead of always competing. This one-upmanship is self sustaining and it's probably the most substantial obstacle to progress on so many fronts.

dippin

I am sorry, but you don't understand the difference between nominal growth and real growth, do you?


Budgets will always include "nominal" gdp because they are the budget for the current year. The reason they also forecast inflation for the following years is precisely because they recognize that nominal figures for any year other than the current year is meaningless.


Nominal GDP growth is not economic growth, it simply means that the price of the goods and services produced in a given year went up. To put it in as simple manner as possible: the Obama administration has assumed that economic production this year will go down by 1.2%. To say that the Obama budget forecast economic growth this year is a lie, it is as simple as that.

aceventura3

I think I do. But, who am I, just one of the few people who actually took a few minutes to look at Obama's budget?


I think you have it backward regarding what has meaning and what does not.

When I pay taxes I don't pay them on an inflation adjusted basis, I pay them in "nominal" dollars.

When I check my 401(k), the balance is not in inflation adjusted dollars, the balance is in "nominal" dollars.

When I shop, I don't spend inflation adjusted dollars, I spend "nominal" dollars.

When I get compensated for what I do, I don't get inflation adjusted dollars, I get "nominal" dollars.


Nominal dollars are "real", inflation adjusted dollars or what they call "real" are a theoretical adjustment of purchasing power loaded with assumptions in the calculations that may or may not be true on a micro or macro basis. Raw data tells truth, adjusted data tell people what they want it to tell them. I either do my own adjusting or I want to understand in detail the calculations used by others. What you do is your preference, but I know what has meaning and I take the extra step to try to understand that meaning.

Given, Obama's budget, and no explanation of how they came up with the "real" GDP growth rate of -1.2, there is on the surface conflicting information that begs a question (asking questions and not blindly accepting what is said - is the point of my first post on this subject). They show an increase in nominal GDP, a decrease in real GDP, and then they show a negative CPI of 0.6%. Don't know about you, but I need some clarity on that point.


Come now, we know there are different ways to measure "economic growth". If "economic growth" is the increase in goods and services produced by an economy over time that is clearly "nominal". And we can certainly talk about inflation adjusted "economic growth" or what they would call "real". But, then we could measure "economic growth" in terms of productivity gains or "economic growth" per capita, which may actually more accurately reflect the standard of living and in other ways. But regardless of how we split hairs here, nominal or real GDP is one commonly accepted measure of "economic growth".

All of this is kinda fun, but let's not loose focus on Obama's double speak. Assuming we actually have negative GDP growth of 1.2% that is nothing close to the Depression years, starting in 1930 - (8.6%), 1931 - (6.4%), 1932 - (-13%). In 1980 the decline was about (1.9%), in real terms. So, at the very least Obama's doom and gloom rhetoric does not match his budget.

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dippin

That is not nominal. That is real. If nominal GDP increases but real GDP doesn't all you had was a price increase across the board.



It is not splitting hairs. Economic growth is, by definition, real growth. There is no splitting hairs, and it is not a matter of opinion. A price increase is not actual growth.

An increase in prices is not economic growth. In fact, in a situation where there is hyperinflation, like Germany in the interwar period, nominal GDP increases very fast, but no one would call that economic growth, especially since actual production decreased.

People adjust GDP for inflation because price increases are not economic growth. Obama's budget clearly predicts a decrease of 1.2% in real GDP, which means that there is no economic growth. In fact, there is a decrease of 1.2% in the size of the economy.

If nominal gdp growth was economic growth, all the government would have to do was paint three additional zeros in every bill and the economy would grow 1000x.

Are the GDP provisions rosy? yes.

Did Obama actually predict economic growth? No, and there are no two ways about it.

BogeyDope

Truth doesn't exist.

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aceventura3

How do you reconcile him showing an increase in "nominal" GDP, negative CPI, and a decrease in "real" GDP? How does he reconcile this? If I am the only one confused, please help me see the light?

Regarding your statement that Obama did not predict economic growth...perhaps he didn't. Perhaps he was not involved in the development of the GDP portion of his budget and the "rosy" projections in the face of "the worst financial crisis since the depression."

---------- Post added at 03:18 PM ---------- Previous post was at 03:17 PM ----------

Is that a truth?

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"Democracy is two wolves and a sheep voting on lunch."
"It is useless for the sheep to pass resolutions on vegetarianism while the wolf is of a different opinion."
"If you live among wolves you have to act like one."
"A lady screams at the mouse but smiles at the wolf. A gentleman is a wolf who sends flowers."

dippin

It is impossible to reconcile positive nominal gdp growth, negative inflation, and negative gdp growth.

However, Obama's budget is not based on current CPI, but the estimated inflation for 2009.

In any case, the fact remains, the Obama budget does not predict any economic growth for this year, rosy as it might be.

aceventura3

Help.

How do you know that his budget does not predict economic growth when we (perhaps me) can not explain or understand the assumptions in his budget?

Here is what we do know: His budget predicts an increase in GDP in 2009.

Let's stop tap dancing around the main point. Obama says what he feels he needs to say when he needs to say it without regard for truth. Obama sells "snake oil", I personally don't like this and I don't buy into his b.s.

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"If you live among wolves you have to act like one."
"A lady screams at the mouse but smiles at the wolf. A gentleman is a wolf who sends flowers."

ratbastid

It is shocking that these two points can come out of you without anything but two hard-returns between them, and without any irony. You simultaneously don't understand the budget, AND know what the budget says.

Do you know what the budget says because somebody on the radio or TV told you? That's what I suspect. Particularly because of how this:

... sounds. You're quoting Limbaugh chapter and verse, here. Which means there's no discussing this with you.

aceventura3

I looked at the budget. The numbers speak for themselves, the assumptions behind the numbers don't.

Yea, that's a new one. Not. I am repeating talking points? Read what I wrote on this subject and others, then look at the dates, then compare that to conservative talking points. When you or anyone can back up that charge with facts I will take it seriously and not respond in a mocking fashion with loads sarcasm and humor (at least to me, I do laugh at my own jokes)

Oh and, after we again make a detour away from the point, how do we reconcile Obama showing an increase in GDP, lower CPI and a decrease in "real" GDP? And after that, lets try to understand how a man can submit a budget showing GDP growth on the same day he is saying the economy is in the worst financial crisis since the Great Depression and nobody asks a question about it.

__________________
"Democracy is two wolves and a sheep voting on lunch."
"It is useless for the sheep to pass resolutions on vegetarianism while the wolf is of a different opinion."
"If you live among wolves you have to act like one."
"A lady screams at the mouse but smiles at the wolf. A gentleman is a wolf who sends flowers."

dippin

His budget includes estimates of inflation, and if you don't understand that, it is your fault.

The figures in his budget are clear for all to see, and have been widely reported:

1.2% decline this year, 3.2% increase next.

We can debate these figures as much as you like, and they are certainly on the rosy side.

But it is ironic, to say the least, that you want to discuss how misleading his budget is by misleading even further.

---------- Post added at 12:40 PM ---------- Previous post was at 12:32 PM ----------

FYI:

http://www.whitehouse.gov/omb/assets...ry_Tables2.pdf

Look at page 20. All the assumptions and estimates of the Obama budget are there, including how they compare to the CBO estimate and to the private market estimates.

If you still insist that hhe predicts economic growth for 2009, there is absolutely nothing I can add to this.

---------- Post added at 02:01 PM ---------- Previous post was at 12:40 PM ----------

Just saw an interview where a republican rep. from Indiana, if Im not mistaken, has just admitted that the GOP alternative budget would do nothing about deficits, and might cost more than the Obama bill.

And the Center for Tax Justice has just release a report that the GOP alternative budget would cost about 300 billion more than the Obama plan, given similar assumptions.

aceventura3

This is an interesting exchange. Why do you ignore the budget showing an increase in GDP? Again how do you reconcile an increase in nominal GDP, a decrease in CPI, and a decrease in "real" GDP?

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"Democracy is two wolves and a sheep voting on lunch."
"It is useless for the sheep to pass resolutions on vegetarianism while the wolf is of a different opinion."
"If you live among wolves you have to act like one."
"A lady screams at the mouse but smiles at the wolf. A gentleman is a wolf who sends flowers."

dippin

I am not ignoring anything, but it is amazing to me how you think that your own lack of understanding of the budget is Obama's fault.

Inflation is measured in multiple ways. An inflation measure is nothing more than a weighed measure of changes in prices.

The CPI is the changes in price weighed by how important certain items are on a typical consumer's budget.

However, to get at the real GDP, the inflation measure is weighed by the relative importance of each sector on the GDP.

They predict an increase in nominal GDP of 0.07%, a GDP price index increase of 1.2%. Not surprisingly, rounded out, the result is a decrease in real GDP of 1.2%.

What is amazing to me is that throughout this discussion you have insisted that this can't be somehow your own misunderstandings of economic terminology, but instead a huge Obama lie that no one but you recognized.

Tully Mars

So the GOP released their budget this morning. Anyone have a link so I can go read it, I can't find one yet.

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asaris

Here's a link: Budget Committee Republicans, U.S. House of Representatives, Washington, D.C.

I'm not really a numbers guy myself.

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kutulu

Do they realize the irony of releasing their budget on April Fool's Day?

Looking at their 'tax proposal' their idea would be to remove just about anything progressive from the current system. HUGE tax cuts for the wealthy. Huge cuts to corporate tax rates (and the obvious assumption that all the 'savings' would be given to the workers)

filtherton

I think they're hedging their bets on how it will be received.

dippin

that GOP budget is a a joke. First of all, it is highly contradictory. It attacks the Obama's budget because it will "increase taxes," while proposing "cost sharing" readjustments. And, of course, no numbers are included again, other than "projections" that are never explained. They don't say how much they will adjust the "cost sharing" part of medicare, for example.

In fact, other than mystical projections, it includes nothing of substance. They propose to cut taxes, increase spending on defense, medicare, medicaid, and veteran's benefits.

Now, how will they pay for all of that? They will pay for all of that with even rosier GDP predictions.

That is basically it. Their budget is "if we cut taxes again, the economy will grow so much faster that we can pay for everything, and the only things we would need to cut are SS benefits of the richer, but only starting in 2036, and including an unspecified cost sharing measure to medicare part d"

Im sure some of the more gullible republicans will love it, as it achieves the mythical dream of paying for more with less taxes. But the exact same problem of the Obama budget is simply compounded here. Obama pays for a lot of his stuff with rosy predictions, the GOP decided to predict an even faster recovery and future growth to pay for things.