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(Slate)   Mitt Romney's tax plan might actually make sense   (slate.com) divider line 349
    More: Interesting, Mitt Romney, American conservatives  
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6696 clicks; posted to Politics » on 10 Aug 2012 at 1:05 AM (2 years ago)   |  Favorite    |   share:  Share on Twitter share via Email Share on Facebook   more»



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2012-08-09 08:38:31 PM
Unlikely tag get lost?
 
2012-08-09 08:40:53 PM
www.slate.com

"See Mr. Romney? If I piss on your shoe it makes it dry faster. Just like your tax plan will help the country."
 
2012-08-09 08:41:09 PM
But since Romney won't defend this on the merits, I will. The good thing about taxes is they raise revenue, which can be used to do useful things. The bad thing about taxes is they may be a drag on economic growth. But here there are two considerations. One is the "incentive effect" of taxes-higher taxes mean less incentive to do economically valuable things. The other is the "income effect"-less money in your pocket means more incentive to do economically valuable things. The genius of Romney's plan is that by eliminating deductions it leaves middle class families with less money in their pockets (so a pro-growth income effect) while also lowering the tax rate they pay on a marginal dollar of additional earnings (so a pro-growth incentive effect). Basically it's a huge win. You get a bunch of revenue in a way that bolsters the country's growth prospects. The voters don't want to hear that this is a good idea, but it's a good idea.

Uh .. what? Am I going mad here?
 
2012-08-09 08:41:44 PM
If you ignore that there are actual people involved and just pretend you're looking at numbers on a page, and throw out the benefits of lower income inequality, then if you squint really hard you can almost rationalize it.

Congratulations. I hope you have a dental pick or something to get that knot out of your logic.
 
2012-08-09 08:42:23 PM

Nadie_AZ: But since Romney won't defend this on the merits, I will. The good thing about taxes is they raise revenue, which can be used to do useful things. The bad thing about taxes is they may be a drag on economic growth. But here there are two considerations. One is the "incentive effect" of taxes-higher taxes mean less incentive to do economically valuable things. The other is the "income effect"-less money in your pocket means more incentive to do economically valuable things. The genius of Romney's plan is that by eliminating deductions it leaves middle class families with less money in their pockets (so a pro-growth income effect) while also lowering the tax rate they pay on a marginal dollar of additional earnings (so a pro-growth incentive effect). Basically it's a huge win. You get a bunch of revenue in a way that bolsters the country's growth prospects. The voters don't want to hear that this is a good idea, but it's a good idea.

Uh .. what? Am I going mad here?


Destroying the middle class at the expense of higher profit for the rich is a good thing, didn't you know?
 
2012-08-09 08:43:12 PM
To whom?
 
2012-08-09 08:43:50 PM

MacEnvy: If you ignore that there are actual people involved and just pretend you're looking at numbers on a page, and throw out the benefits of lower income inequality, then if you squint really hard you can almost rationalize it.

Congratulations. I hope you have a dental pick or something to get that knot out of your logic.


Honestly, we do need to raise taxes some on the middle class. Can't close the deficit realistically with only taxes on the rich.

But there's no reason to raise taxes on the middle class to give the rich another tax cut.
 
2012-08-09 08:46:05 PM

Nadie_AZ: But since Romney won't defend this on the merits, I will. The good thing about taxes is they raise revenue, which can be used to do useful things. The bad thing about taxes is they may be a drag on economic growth. But here there are two considerations. One is the "incentive effect" of taxes-higher taxes mean less incentive to do economically valuable things. The other is the "income effect"-less money in your pocket means more incentive to do economically valuable things. The genius of Romney's plan is that by eliminating deductions it leaves middle class families with less money in their pockets (so a pro-growth income effect) while also lowering the tax rate they pay on a marginal dollar of additional earnings (so a pro-growth incentive effect). Basically it's a huge win. You get a bunch of revenue in a way that bolsters the country's growth prospects. The voters don't want to hear that this is a good idea, but it's a good idea.

Uh .. what? Am I going mad here?


2.bp.blogspot.com

The author is simply saying that having less money in your pocket is an incentive to make more money whereas having more money in your pocket is also an incentive to make more money. Perfectly cromulent explanation.
 
2012-08-09 08:51:19 PM

GAT_00: MacEnvy: If you ignore that there are actual people involved and just pretend you're looking at numbers on a page, and throw out the benefits of lower income inequality, then if you squint really hard you can almost rationalize it.

Congratulations. I hope you have a dental pick or something to get that knot out of your logic.

Honestly, we do need to raise taxes some on the middle class. Can't close the deficit realistically with only taxes on the rich.

But there's no reason to raise taxes on the middle class to give the rich another tax cut.


I'm not denying that. But there's absolutely no coherent message in this piece that even remotely justifies Romney's plan.
 
2012-08-09 08:52:50 PM

MacEnvy: GAT_00: MacEnvy: If you ignore that there are actual people involved and just pretend you're looking at numbers on a page, and throw out the benefits of lower income inequality, then if you squint really hard you can almost rationalize it.

Congratulations. I hope you have a dental pick or something to get that knot out of your logic.

Honestly, we do need to raise taxes some on the middle class. Can't close the deficit realistically with only taxes on the rich.

But there's no reason to raise taxes on the middle class to give the rich another tax cut.

I'm not denying that. But there's absolutely no coherent message in this piece that even remotely justifies Romney's plan.


I think some days the editors at Slate freak out because they haven't published enough and just throw together whatever they can in 10 minutes.
 
2012-08-09 08:55:20 PM

mrshowrules: The author is simply saying that having less money in your pocket is an incentive to make more money whereas having more money in your pocket is also an incentive to make more money. Perfectly cromulent explanation.


In that case, I'd be glad to help the author make more money by taking his.
 
2012-08-09 08:56:53 PM
The other is the "income effect"-less money in your pocket means more incentive to do economically valuable things. The genius of Romney's plan is that by eliminating deductions it leaves middle class families with less money in their pockets (so a pro-growth income effect) while also lowering the tax rate they pay on a marginal dollar of additional earnings (so a pro-growth incentive effect). Basically it's a huge win.

It's a huge win for the rich and a neutral effect maybe on the treasury. Economically valuable things means, for the middle class, farking surviving. Buying food and shelter and giving up anything that could be considered a luxury, like cable TV, a good car, college, new clothes...things like that.

So fark you, Yglesias, you farking hack.
 
2012-08-09 09:01:55 PM
www.slate.com

If you load it up with debt, keep millions for yourself, fire all the employees and then bankrupt it, they will come.
 
2012-08-09 09:04:53 PM
www.slate.com

Malachai! He wants you too, Malachai. He wants you too!
 
2012-08-09 09:06:10 PM

GAT_00: MacEnvy: GAT_00: MacEnvy: If you ignore that there are actual people involved and just pretend you're looking at numbers on a page, and throw out the benefits of lower income inequality, then if you squint really hard you can almost rationalize it.

Congratulations. I hope you have a dental pick or something to get that knot out of your logic.

Honestly, we do need to raise taxes some on the middle class. Can't close the deficit realistically with only taxes on the rich.

But there's no reason to raise taxes on the middle class to give the rich another tax cut.

I'm not denying that. But there's absolutely no coherent message in this piece that even remotely justifies Romney's plan.

I think some days the editors at Slate freak out because they haven't published enough and just throw together whatever they can in 10 minutes.


It's just typical Matthew Yglesias, doing his best to carry water for the Republicans while maintaining his status as a "liberal blogger". He does this stuff all the time. It only rarely makes sense.

I have no idea what he's going for, except pageviews.
 
2012-08-09 09:08:09 PM
Even though others have posted this, I will do it too, with my own thought on it.

FTA: But here there are two considerations. One is the "incentive effect" of taxes-higher taxes mean less incentive to do economically valuable things. The other is the "income effect"-less money in your pocket means more incentive to do economically valuable things.

My thought: WTF? This guy switches positions faster than Romney.
 
2012-08-09 09:08:50 PM
I'm going to give Yglesias the benefit of the doubt and say this was just an attempt at sarcastic humor that went badly astray. Because if it was in any way serious, he's gone off the deep end.
 
2012-08-09 09:09:10 PM
www.slate.com

Mr. Romney, sir, I think you've kicked that poor dog enough. I think it's dead."
 
2012-08-09 09:10:11 PM
www.slate.com

"Wow. Just blood and feathers left!"
 
2012-08-09 09:11:47 PM
Okay, can anyone explain what Iglesias was trying to say in a way that makes sense? All I got from that was "I'm going to make some bare assertions on the assumption that you'll believe what I tell you, since you trust the internet implicitly." Am I wrong?
 
2012-08-09 09:12:37 PM

Dinki: I'm going to give Yglesias the benefit of the doubt and say this was just an attempt at sarcastic humor that went badly astray. Because if it was in any way serious, he's gone off the deep end.


It almost reads like that, but you can't be sure. What a weird piece.
 
2012-08-09 09:13:02 PM
Children Of The Corn 2012
www.slate.com
 
2012-08-09 09:13:50 PM

Dinki: I'm going to give Yglesias the benefit of the doubt and say this was just an attempt at sarcastic humor that went badly astray. Because if it was in any way serious, he's gone off the deep end.


Why? He's farking retarded.
 
2012-08-09 09:16:31 PM
www.slate.com

"And that's where I buried the Spilotro brothers"
 
2012-08-09 09:20:20 PM
www.slate.com

I am aware this is not a banana. But I wanted to confirm with you, Farmer 3243.
 
2012-08-09 09:20:59 PM
I mean, I assume the spelling and grammar is all in order, if thats what you mean.
 
2012-08-09 09:23:45 PM

Nadie_AZ: But since Romney won't defend this on the merits, I will. The good thing about taxes is they raise revenue, which can be used to do useful things. The bad thing about taxes is they may be a drag on economic growth. But here there are two considerations. One is the "incentive effect" of taxes-higher taxes mean less incentive to do economically valuable things. The other is the "income effect"-less money in your pocket means more incentive to do economically valuable things. The genius of Romney's plan is that by eliminating deductions it leaves middle class families with less money in their pockets (so a pro-growth income effect) while also lowering the tax rate they pay on a marginal dollar of additional earnings (so a pro-growth incentive effect). Basically it's a huge win. You get a bunch of revenue in a way that bolsters the country's growth prospects. The voters don't want to hear that this is a good idea, but it's a good idea.

Uh .. what? Am I going mad here?


His theory is premised this way:

Premise 1) If people have less money in their pockets, then they'll do more economically worthwhile things (i.e. they'll work more).
Premise 2) If people are taxed less on each additional dollar, then that'll give people an incentive to work harder to make that additional dollar because they'd be taxed less.

This is stupid because:
1) Premise 1 assumes that the job market is a perfect market - anyone who seeks work will be able to find a job with which they can work harder and earn more money. I think it's pretty obvious how flawed this premise is looking at the last 4 years.

2) Premise 2 is hinged on the fact that each marginal dollar will be taxed less - however, this is also flawed because this completely ignores how tax structures work. For the average middle-class individual (let's say someone earning $50,000 a year), each additional dollar he earns isn't going to be taxed at a lower rate because we have tax brackets. In fact, under Romney's plan, only if you make more than $249,999 dollars a year would each additional dollar earned be taxed at a lower rate - this is essentially a benefit only to maybe 2 percent of the population.

So yeah, Yglesias is being stupid. But, frankly, what can you expect from someone with a degree in philosophy who decided to appoint himself an economics journalist?
 
2012-08-09 09:26:10 PM

RexTalionis: This is stupid because:
1) Premise 1 assumes that the job market is a perfect market - anyone who seeks work will be able to find a job with which they can work harder and earn more money. I think it's pretty obvious how flawed this premise is looking at the last 4 years.


This doesn't follow. The income effect has to be take ceterus parabus. This isn't a rebuttal to it at all.

RexTalionis: 2) Premise 2 is hinged on the fact that each marginal dollar will be taxed less - however, this is also flawed because this completely ignores how tax structures work. For the average middle-class individual (let's say someone earning $50,000 a year), each additional dollar he earns isn't going to be taxed at a lower rate because we have tax brackets. In fact, under Romney's plan, only if you make more than $249,999 dollars a year would each additional dollar earned be taxed at a lower rate - this is essentially a benefit only to maybe 2 percent of the population.


But doesn't Romney's plan lower the rate on everyone?
 
2012-08-09 09:28:10 PM
www.slate.com
"Some of my best friends own your crop"
"And your land"
 
2012-08-09 09:34:27 PM
img842.imageshack.us



I hope so anyway
 
2012-08-09 09:34:35 PM

DamnYankees: RexTalionis: This is stupid because:
1) Premise 1 assumes that the job market is a perfect market - anyone who seeks work will be able to find a job with which they can work harder and earn more money. I think it's pretty obvious how flawed this premise is looking at the last 4 years.

This doesn't follow. The income effect has to be take ceterus parabus. This isn't a rebuttal to it at all.


Well, my interpretation of his statement is that if you suddenly find yourself making less, you'd work harder and thus make more money. I mean, I don't know how this statement can be supported without making an assumption about how easy it is in the current economy to make more money.

DamnYankees: But doesn't Romney's plan lower the rate on everyone?


Not according to the Tax Policy Institute's report on Romney's tax plan that was released earlier - they said it'll raise the taxes of everybody except those making more than $250,000 a year. And even so, Yglesias' entire theory is premised on the fact that the middle class will get their taxes raised, anyway (i.e. if middle class makes less, they'll do more economically worthwhile things to try to make more).
 
2012-08-09 09:34:41 PM
"but the idea that high-end tax cuts are more socially beneficial than increased public services is a longstanding American conservative position."

...that flat-out doesn't work.
 
2012-08-09 09:35:28 PM

RexTalionis: Well, my interpretation of his statement is that if you suddenly find yourself making less, you'd be motivated to work harder and thus make more money.


FTFaccuracy.
 
2012-08-09 09:40:12 PM
i47.tinypic.com
 
2012-08-09 09:40:34 PM

DamnYankees: RexTalionis: Well, my interpretation of his statement is that if you suddenly find yourself making less, you'd be motivated to work harder and thus make more money.

FTFaccuracy.


Fair enough, but even so, motivation does not make the middle class make more incomes grow bigger, as Yglesias suggests here:

Romney's plan is that by eliminating deductions it leaves middle class families with less money in their pockets (so a pro-growth income effect)

He's not just talking about motivation or incentive, he's directly claiming that leaving middle class families with less money in their pockets would result in growth in income.

And even so, motivation is fine and dandy, but if the job market or economy doesn't support it, that motivation is just going to be frustrated.
 
2012-08-09 09:42:48 PM
3.bp.blogspot.com
 
2012-08-09 09:50:31 PM
www.slate.com

Indians call it פּאָפּשוי
 
2012-08-09 09:52:35 PM
www.slate.com

"YOU'VE BEEN INTO FARMER MAGGOTS CROP"!
 
2012-08-09 09:53:19 PM

Because People in power are Stupid: [www.slate.com image 568x346]

Indians call it פּאָפּשוי


Popsuey?
 
2012-08-09 09:54:12 PM
www.slate.com

"So if the middle class is this piece of sh*t here, and I step on it like this, see..."
 
2012-08-09 09:54:59 PM
corndogger.com
...just like TFA and Romney's "plan."
 
2012-08-09 10:18:54 PM
i'm going to go with "approaching deadline" + "half-developed satirical piece." it's the only way i'll get to sleep tonight.
 
2012-08-09 10:23:44 PM

God-is-a-Taco: [i47.tinypic.com image 600x480]


i575.photobucket.com
 
2012-08-09 10:25:02 PM
Only to the rich.
 
2012-08-09 10:28:39 PM
 
2012-08-09 11:11:17 PM
by eliminating deductions it leaves middle class families with less money in their pockets (so a pro-growth income effect)

4.bp.blogspot.com
 
2012-08-09 11:24:15 PM

RexTalionis: So yeah, Yglesias is being stupid. But, frankly, what can you expect from someone with a degree in philosophy who decided to appoint himself an economics journalist?


I agree with you 100% and this has long been my complaint with Yglesias, and it seems to be getting worse, however; DeLong and Krugman will disagree with me and you and they have both long given Yglesias links, kudos, and cover.

I do think it's quite likely that at the rate Yglesias is going he will end up at Reason or somewhere else shouting the libertarian economic line.
 
2012-08-10 12:13:20 AM
54% of my pay goes to taxes, healthcare, and retirement savings. How much more do you think we middle class types have to give?
 
2012-08-10 12:19:02 AM

Nadie_AZ: [www.slate.com image 568x346]

I am aware this is not a banana. But I wanted to confirm with you, Farmer 3243.


Hahahahaha!

This thread has potential to become Fark Epic.
 
2012-08-10 12:35:50 AM

GAT_00: Honestly, we do need to raise taxes some on the middle class. Can't close the deficit realistically with only taxes on the rich.

But there's no reason to raise taxes on the middle class to give the rich another tax cut.


Done in what., 6?
 
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