Were Raeganomics really all that bad?

[Anarchy In Detroit]

I believe there is a conscious effort on behalf of the right wing to tax us, give our money to their friends, then ruin the economy just before they leave office. This leaves the mess for everyone else and they get zero blame.

 

[tan-z]

If you don't mind my asking tan-z, which brand of anarchism do you subscribe to? I'm just curious about what is going on in the different schools.

I'm a pluralist, I personally go along with a kind of hybrid collectivism/mutualism/syndicalism though.

EDIT: I'm also wondering why someone with Proudhon as an avatar would object to free markets. Even Bakunin would make more sense for that, it seems.

Because there's a clear difference between the kind of free-market he wants and what I would call a free market and since his ideals have become the dominant ideas associated with 'free'-markets I find that it makes more sense for me to reject the term free market altogether and go for 'voluntary exchange' or some such.

Another thing is that the type of mutualism I would subscribe to is the nineteenth century variety whereas in my experience modern day mutualists seem to have become corrupted with some kind of rothbardian virus.

 

[Rooster Cogburn]

If you don't mind my asking tan-z, which brand of anarchism do you subscribe to? I'm just curious about what is going on in the different schools.

I'm a pluralist, I personally go along with a kind of hybrid collectivism/mutualism/syndicalism though.

EDIT: I'm also wondering why someone with Proudhon as an avatar would object to free markets. Even Bakunin would make more sense for that, it seems.

Because there's a clear difference between the kind of free-market he wants and what I would call a free market and since his ideals have become the dominant ideas associated with 'free'-markets I find that it makes more sense for me to reject the term free market altogether and go for 'voluntary exchange' or some such.

Another thing is that the type of mutualism I would subscribe to is the nineteenth century variety whereas in my experience modern day mutualists seem to have become corrupted with some kind of rothbardian virus.

Heh, ok. I suspect you would probably accuse me of being being corrupted with the 'rothbardian virus'- I'm a market anarchist, you see. I just like to know what different anarchists thinkers are thinking.

EDIT: I don't know if this means anything to you, but I'm a follower of Samuel E. Konkin III- a left libertarian and an Agorist. To some people, that's a different world from Rothbard. To others, it's more of the same.

 

[tan-z]

Heh, ok. I suspect you would probably accuse me of being being corrupted with the 'rothbardian virus'- I'm a market anarchist, you see. I just like to know what different anarchists thinkers are thinking.

Maybe just a little bit, I'm not sure were I stand on modern market anarchism. Some of them seem unable to differentiate themselves from the status quo. But since you self-describe as 'left'-libertarian I probably wouldn't have any issue with you.

EDIT: I don't know if this means anything to you, but I'm a follower of Samuel E. Konkin III- a left libertarian and an Agorist. To some people, that's a different world from Rothbard. To others, it's more of the same.

I've read a bit of SEK III, I suppose he's a little better than rothbard, he wasn't advocating any kind of alliance with paleo-conservatives or the LP. I also think the idea of counter-economics is good, although I half gave up on the agorist primer after I read his out of hand dismissal of LTV.

 

[Unknower]

WRONG that's NOT tax evasion. there are tons of loopholes for the super rich to get out of not paying taxes. them earning a small salary and then having $20 million in tax free bonuses is not tax evasion it's just the way they get paid so they only "earn" smaller amounts of money

i really think you need to give your head a shake and go find out what these people actually get away with

Can you give some specific examples of people using a perfectly legal loophole to get out of not paying taxes? This is entirely beside the fact that you still can't explain how increasing taxes would close these loopholes. I don't want to be mean about it, but you're really just spouting nonsense.

Something similar: quote from Wikipedia [http://en.wikipedia.org/wiki/Warren_Buffet]: "Buffett stated that he only paid 19% of his income for 2006 ($48.1 million) in total federal taxes, while his employees paid 33% of theirs, despite making much less money."

According to Buffet, that's his tax rate without accountants using loopholes. I remember reading something which explained how that works but I don't remember anything about it.

Honestly, I'd say tax everyone equally. There's a reasoning behind my argument and it's selfish at best.
It seems a lot of people have resentment for the rich, which is understandable if you look at people like, I don't know, Paris Hilton.
But could you really hate on someone who has climbed through the ranks and become a successful person on their own merit? Would it honestly be ok to then tax that person to oblivion? I think not.
I say this because, while my mother's not rich, she's been climbing a corporate ladder for a long, long time. When she becomes a VP, I'm sure she'll get more money. Now, considering my mother has been working for about 25 years and maybe start making some serious moolah(not millions) in 5-10 years, I don't think she deserves to get taxed to death.

Seriously, not everyone in the world is a rich little douchebag who never had to work for their money.
I want my mother to do well so that she can finally have the things she wants for putting me and my brother through school. I don't want her to have to worry about being taxed too much.

Your mother will pay more taxes when she'll become a VP because she will have a lot more money and can afford to have higher % of her income taxed and still have lots of money left to buy stuff. Progressive taxation will not tax her to death. Her taxes will not rise so much that she'll make less money as a VP than now.

 

[BonsaiK]

I lived through Reagaonomics. It was a disaster for the US from what I can remember. I can't recall at the time one single media commentator of ANY political persuasion having anything good to say about it, not once.

You, and many others on this forum are making the mistake of thinking the "economy during the Reagan era" and "Reaganomics" are the same thing. They're not.

Well, if they were different things, they were both failures. I know, I was there.

 

[Novan Leon]

Well done, so you don't support free markets.

Then by your logic, complete anarchy is a necessary prerequisite for freedom.

Socialism is a failure? Oh you mean like in russia? Where they had a hellish beuracratic state capitalism? Or in china were they had an oppressive dictatorship? Listen our society is not becoming more and more socialist, in fact I can see a clear move away from socialism. See what you fail to understand is that one of the key aspects of socialism is strong democratic controls over what goes were and what happens in workplaces, basically participatory economics. Frankly I can't see increasing democratisation anywhere, in fact I see more and more taking power away from people.

Do you even know what Socialism means? Look up the definition online. Simply put, Socialism mandates central control of economic resources. How you can claim that Russia and China didn't have central control of economic resources is beyond my understanding.

Communism and Socialism are basically the same, except that Communism includes central control of non-economic factors while Socialism holds a purely economic context. Both Communism and Socialism centrally manage "on behalf of the people". In practice, most Socialist governments tend to be democratic, but the principles of centralized ownership and control are the same whether the government is a democracy or a dictatorship.

Where did the bit about price controls come from? Perhaps you spliced your response to another post into your quote from mine?

I'm not certain how disputing your claim that there is a single definition of equality in the context of taxation implies an overarching moral assumption on my part. I also don't appreciate your insinuations regarding my motives and qualifications. Insulting me does nothing to advance your arguments.

This was in response to your quote below:

Attempting an objective definition of equality in the context of economics is more trouble than herding cats. One might say that it's equality for workers to be paid the same hourly wage. One could say that all people should have the same standard of living, or that everyone should simply be left alone to fail or prosper. One might say that everyone should pay the same absolute amount, or the same portion of their income, or that it's inherently unequal for wealth to be redistributed at all.

Equality in the context of taxation is simple. Tax everyone equally, regardless of the measure used. Either tax everyone $5, or 5% of their income, or 5% of retail sales. However you like to do it, but do it equally for all people.

Your statements above sound like you're advocating authority control over economic outcome based on subjective moral judgements (ie. some people "should", or "shouldn't" have X). Mandating outcome based on a subjective measure is dangerous stuff. There's a big difference between treating people equally and mandating equal outcome (unequal treatment of people). This is an economic philosophy that is both ignorant and arrogant. I didn't mean to accuse you, merely your ideological position.

Well, if they were different things, they were both failures. I know, I was there.

The 80's recession is generally believed to have been caused by Reagan's efforts to reduce inflation by decreasing the amount of currency in circulation. Whenever inflation is reduced there is always some level of economic fallout, but lower inflation sets the groundwork for a more stable and successful economy down the road.

So yes, I admit you're correct in the sense that Reaganomics likely caused the recession. This ignores the substantial benefits to reducing inflation, however.

 

[Rolling Thunder]

It just occurred to me that Obama's actions are exactly the opposite of Reaganomics. Obama is (1) increasing government spending, (2) increasing government regulation, (3) increasing taxes, (whether the taxes are progressive or not, they're still increasing as a whole) and (4) increasing inflation by increasing the amount of new currency in circulation.

I guess we will see how 'Obamanomics' works in the next few years, eh?

Keynes approves, except of the increasing taxes. Show me an economist who supported Reagan and I'll show you a fool.

 

[Novan Leon]

It just occurred to me that Obama's actions are exactly the opposite of Reaganomics. Obama is (1) increasing government spending, (2) increasing government regulation, (3) increasing taxes, (whether the taxes are progressive or not, they're still increasing as a whole) and (4) increasing inflation by increasing the amount of new currency in circulation.

I guess we will see how 'Obamanomics' works in the next few years, eh?

Keynes approves, except of the increasing taxes. Show me an economist who supported Reagan and I'll show you a fool.

How about we start with Nobel Prize winning economists Milton Friedman and Robert A. Mundell to start with.

Don't even get me started on Keynesian economics.

 

[Horticulture]

Equality in the context of taxation is simple. Tax everyone equally, regardless of the measure used. Either tax everyone $5, or 5% of their income, or 5% of retail sales. However you like to do it, but do it equally for all people.

Your statements above sound like you're advocating authority control over economic outcome based on subjective moral judgements (ie. some people "should", or "shouldn't" have X). Mandating outcome based on a subjective measure is dangerous stuff. There's a big difference between treating people equally and mandating equal outcome (unequal treatment of people). This is an economic philosophy that is both ignorant and arrogant. I didn't mean to accuse you, merely your ideological position.

I think I see where the confusion lies now. When I say "One could say that all people should have the same standard of living, or that everyone should simply be left alone to fail or prosper. One might say that everyone should pay the same absolute amount, or the same portion of their income, or that it's inherently unequal for wealth to be redistributed at all.", I mean to highlight five different (and incompatible) ways in which equality might be defined, in support of my assertion that it's a subjective definition.

Equality in the context of taxation is simple. Tax everyone equally, regardless of the measure used. Either tax everyone $5, or 5% of their income, or 5% of retail sales.

I'm pretty sure you aren't supposed to use a word in its own definition Each of those is an equitable method of taxation in some sense (total value, rate, consumption), as is progressive taxation (everyone pays the same rate on the first tax bracket, the same rate on the second, all the way up to the top.) If I make $10000 this year and a million next, I'm being taxed at different rates, but the tax is being applied equally because anyone else in my position (the poor in the former case and the rich in the latter) would be taxed the same way.

Framing our debate around the word equality seems to invite doublespeak ("We are all equal, but some of us are more equal than others..."). Looking at taxes as a moral or philosophical issue, in my view, misses the point. Taxes are a solution to the practical problem of providing sufficient revenue to run a government. Using them as a weapon for class warfare, as you've indicated, would be a mistake. Likewise, elevating tax code into a philosophical treatise reduces the effectiveness of the tax code itself. An effective tax code should raise sufficient revenue to cover government expenditures while minimizing the economic disruption of the tax. Progressive taxation accomplishes this because the burden of a given tax rate or amount on lower earners is much higher, making it more disruptive to tax them at the same rate as wealthier individuals.

This is especially true under a state that provides social services, as the general trend is to redistribute some measure of wealth downward (i.e. low earners receive more in government services than they pay in taxes), making it redundant (and likely wasteful) to tax them at the same rate as wealthier taxpayers.

How about we start with Nobel Prize winning economists Milton Friedman and Robert A. Mundell to start with.

Don't even get me started on Keynesian economics.

I'll see your Friedman and Mundell and raise you Krugman and Stiglitz

 

[Rolling Thunder]

It just occurred to me that Obama's actions are exactly the opposite of Reaganomics. Obama is (1) increasing government spending, (2) increasing government regulation, (3) increasing taxes, (whether the taxes are progressive or not, they're still increasing as a whole) and (4) increasing inflation by increasing the amount of new currency in circulation.

I guess we will see how 'Obamanomics' works in the next few years, eh?

Keynes approves, except of the increasing taxes. Show me an economist who supported Reagan and I'll show you a fool.

How about we start with Nobel Prize winning economists Milton Friedman and Robert A. Mundell to start with.

Don't even get me started on Keynesian economics.

O, RLY?

Friedman and Mundall supported running a deficet during a time of peace and economic growth, eh? They supported lowering the interest rates during said economic growth, eh? They supported taking money from essential public services and then cutting taxes, eh?

Oh, wait, they didn't.

 

[Novan Leon]

I think I see where the confusion lies now. When I say "One could say that all people should have the same standard of living, or that everyone should simply be left alone to fail or prosper. One might say that everyone should pay the same absolute amount, or the same portion of their income, or that it's inherently unequal for wealth to be redistributed at all.", I mean to highlight five different (and incompatible) ways in which equality might be defined, in support of my assertion that it's a subjective definition.

I see, though I'm not sure how you can confuse the mandate of an equal outcome (receive the same hourly wage, hold the same standard of living) with equal treatment (pay the same absolute amount, or the same portion of their income). No matter.

Equality in the context of taxation is simple. Tax everyone equally, regardless of the measure used. Either tax everyone $5, or 5% of their income, or 5% of retail sales.

I'm pretty sure you aren't supposed to use a word in its own definition

I'm not defining the word "equality", I'm explaining how the word "equality" applies to "taxation", then proceed to give an example.

Framing our debate around the word equality seems to invite doublespeak ("We are all equal, but some of us are more equal than others..."). Looking at taxes as a moral or philosophical issue, in my view, misses the point. Taxes are a solution to the practical problem of providing sufficient revenue to run a government. Using them as a weapon for class warfare, as you've indicated, would be a mistake. Likewise, elevating tax code into a philosophical treatise reduces the effectiveness of the tax code itself. An effective tax code should raise sufficient revenue to cover government expenditures while minimizing the economic disruption of the tax. Progressive taxation accomplishes this because the burden of a given tax rate or amount on lower earners is much higher, making it more disruptive to tax them at the same rate as wealthier individuals.

I agree that the debate has become about the word 'equality' when it should really be about the philosophies of 'Equality of Outcome' versus 'Equality of Opportunity' (ie. equal treatment).

Your view of taxes being it's sole purpose to provide sufficient revenue to run government is idealistic but disconnected from reality. In our modern world, people, government officials included, will spend without restraint and then tax to make up the difference. Politicians have agendas and continually strive to improve their own situation by amassing power, money and influence. Taxes and fees are used as a way to influence people and punish/reward people in ways that benefit their own interests. Politicians use the emotions of ignorant people to convince them that rich minority is not only beneficial or necessary, but a way to deal justice to those who've taken their unfair share. Unsuspecting people buy into this premise instead of asking why the Politicians can't control spending.

Equal treatment of all individuals is an objective standard that is easy to judge and follow, and doesn't make allowance for subjective judgements for selfish people to bend and sway to their will. A progressive tax is one step away from the philosophy of 'Equality of Opportunity' towards that of 'Equality of Outcome' (wealth distribution). It looks good on paper to those who aren't educated, but it opens the door for further steps in that direction.

How about we start with Nobel Prize winning economists Milton Friedman and Robert A. Mundell to start with.

Don't even get me started on Keynesian economics.

I'll see your Friedman and Mundell and raise you Krugman and Stiglitz

But this doesn't explain how any economist who supports Reagan is a fool, since Friedman and Mundell are definitely NOT fools. I don't have any way of verifying this, but I would wager that there are more economists out there that support the principles of Reaganomics than don't.

How about we start with Nobel Prize winning economists Milton Friedman and Robert A. Mundell to start with.

Don't even get me started on Keynesian economics.

O, RLY?

Friedman and Mundall supported running a deficet during a time of peace and economic growth, eh? They supported lowering the interest rates during said economic growth, eh? They supported taking money from essential public services and then cutting taxes, eh?

Oh, wait, they didn't.

The Cold War was going on, and what 'essential' public services did they take money from? I'm not aware of any bad side effects from cutting the 'essential' public services you mention. Reagan lowered interest rates?

Business Week magazine:
To Milton Friedman, the Nobel prize-winning economist, Reagan's tax cuts -- especially the 1986 bill -- were "one of the most important factors in the boom of the 1990s." Adds Robert A. Mundell, another Nobel laureate: "[They] made the U.S. economy the motor for the world economy in the 1990s, on which the great revolution in information technology was able to feed."

 

[Horticulture]

I agree that the debate has become about the word 'equality' when it should really be about the philosophies of 'Equality of Outcome' versus 'Equality of Opportunity' (ie. equal treatment).

Your view of taxes being it's sole purpose to provide sufficient revenue to run government is idealistic but disconnected from reality. In our modern world, people, government officials included, will spend without restraint and then tax to make up the difference. Politicians have agendas and continually strive to improve their own situation by amassing power, money and influence. Taxes and fees are used as a way to influence people and punish/reward people in ways that benefit their own interests. Politicians use the emotions of ignorant people to convince them that [taxing the] rich minority is not only beneficial or necessary, but a way to deal justice to those who've taken their unfair share. Unsuspecting people buy into this premise instead of asking why the Politicians can't control spending.

Equal treatment of all individuals is an objective standard that is easy to judge and follow, and doesn't make allowance for subjective judgements for selfish people to bend and sway to their will. A progressive tax is one step away from the philosophy of 'Equality of Opportunity' towards that of 'Equality of Outcome' (wealth distribution). It looks good on paper to those who aren't educated, but it opens the door for further steps in that direction.

You've read too much

and not enough

Also, I think you're misapplying equality of opportunity [http://plato.stanford.edu/entries/equal-opportunity/].

 

[Novan Leon]

Also, I think you're misapplying equality of opportunity [http://plato.stanford.edu/entries/equal-opportunity/].

The phrase 'Equality of Opportunity' can be used in both ways. The 'Equality of Opportunity' definition I'm using is the philosophical contrast to 'Equality of Outcome' referred to here [http://en.wikipedia.org/wiki/Equality_of_outcome]. Both phrases are somewhat self-explanatory regardless.

Quite frankly, the problem with a lot of people's economic education is that they've been spending too much time with their head buried in books and haven't spent enough time living it. When you work in business and are actively involved in the economy on many levels, you gain an appreciation for economics on a practical level that totally eludes armchair theorists.

 

[Berethond]

Inarticulate is the name of the game.

As a republican, I believe in principle that many of the policies are correct, but deficit spending is one thing I detest.

That, and most people don't realize it was the Republican Congress, not President Clinton, who decreased the deficit and caused the economic boom.

Clinton was the luckiest president of all time. He had next to no real issues.

Hell, he had enough free time to mess around with the interns.

 

[Gildan Bladeborn]

Well done, so you don't support free markets.

Then by your logic, complete anarchy is a necessary prerequisite for freedom.

While I'm reasonably certain you said this in a disparaging manner, that's essentially correct - complete anarchy is a necessary prerequisite for freedom, because true freedom is essentially anarchy. If all of our various systems were absolutely free, then anarchy is what we'd have and that would neatly obviate the reason we created those systems in the first place, as they are all efforts to avoid anarchy by restricting freedom - some just restrict less than others.

Absolute freedom is a highly unpleasant state of being thanks to mankind not being comprised entirely of saints - thank goodness we don't actually have true freedom!

 

[Novan Leon]

Well done, so you don't support free markets.

Then by your logic, complete anarchy is a necessary prerequisite for freedom.

While I'm reasonably certain you said this in a disparaging manner, that's essentially correct - complete anarchy is a necessary prerequisite for freedom, because true freedom is essentially anarchy. If all of our various systems were absolutely free, then anarchy is what we'd have and that would neatly obviate the reason we created those systems in the first place, as they are all efforts to avoid anarchy by restricting freedom - some just restrict less than others.

Absolute freedom is a highly unpleasant state of being thanks to mankind not being comprised entirely of saints - thank goodness we don't actually have true freedom!

The problem is, total anarchy inevitably gives people the freedom to trample on the freedom of others. The ultimate result is complete freedom for some and the complete loss of freedom for many. I would argue that this kind of society is actually less free than one that establishes boundaries so that people can no longer infringe upon the freedom of others.

 

[TheRundownRabbit]

You mean Reaganomics and it was amassive acheivement and p;ossibly the best thing thart has ever happened to the US

 

[lacktheknack]

Being born in 1992 I have only a small idea of what Reagonomics is but from what I heard it gave tax breaks to the rich which is a STUPID IDEA!

I hate it when people make comments like this, IRL or on the internet. It just shows how ignorant people are when it comes to principles of economics and free market capitalism.

It's none of our business how much people make! What right does anyone have to limit anyone else's potential? That includes the government.

Whatever happened to the concept of equality? Nowadays equality is being replaced with the idea of "fairness". Equality is objective, fairness is subjective. Equality is obvious. Fairness depends on someone to decide what "fair" is and then take action to punish or reward someone to make sure things remain "fair". I'll take equality over fairness any day.

I make $5 a day. If I'm taxed 10% of my income, so should the guy who makes $5 million a day.

Reagonomics are sound economic principles and policies that people should emulate. Anyone who understands the principles of economics and the capitalist free market system can speak to this.

So your idea of equality is letting people who make more money pay less taxes and the ones who make less pay more? Taxes should be directly proportional to income.

And if you want to talk about limiting people's potential how about the fact that my family can barely pay our bills, because they're so high, even though they work 50+ hours a week? My parents are honest, hard-working people; why can't their taxes be lowered?

How is 10% of $5,000,000 less than 10% of $5? Explain that to me.

Your story is heartbreaking but your argument is an appeal to emotion. You're advocating inequality (taxing some people more than others) based purely on emotional grounds. If you wanted to reduce taxes for everyone, that would be a different matter entirely.

I'm not advocating that.

My parents don't pay the same percentage as richer people, that is the problem, they pay a much higher percentage and as a result can often not make end's meet. There should be a standard percentage to pay in taxes; but it seems that the government only lowers taxes for the rich and keeps the lower-class taxes the same.

Two problems here:
A. You didn't read the other guy properly.
B. Reaganomics don't theoretically work like that (high taxes on the poor). Research is required on your part.

 

[FiveSpeedf150]

Being born in 1992 I have only a small idea of what Reagonomics is but from what I heard it gave tax breaks to the rich which is a STUPID IDEA!

I'll take a wild guess that you aren't rich.

Ya see, I'd like to be rich someday. So I'm not going to go out of my way to cut the upper class off at the knees.

Also, there's a little saying... nobody gets hired by poor people.