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News & ArtsMonday, December 6, 2010
Politics Nate Silver on the Bush Tax Cuts
Posted by Paul Constant on Mon, Dec 6, 2010 at 3:12 PM
As always, Nate Silver gives thoughtful analysis of the current political situation:
So, the theory goes, if Democrats would prefer extending the tax cuts for incomes below $250,000 to letting all of them expire, and so would Republicans — and so, for that matter, would the general public — then what, exactly, is the rub? Not that victories in Congress ever come easily, but shouldn’t this be a fight that the Democrats can win?The problem with this theory is that it relies, implicitly, on the assumption that the Democrats can take the third option — extending the tax cuts for everyone — off the table. If the Democrats could do this, then they would be in a very strong position. But this is not so easy to do.
We know what the Democrats’ first preference is: extending the tax cuts below $250,000 only. But what is their second preference? If forced to make a choice, would they rather extend the tax cuts for everyone, or for no one?
Republicans, evidently, believe it is the former; this is why they unanimously voted against cloture in the Senate today.
I would trade ten thousand frothing liberal blogs for one Nate Silver.
1
Shouldn't this be titled "Nate Silver on the Bush Middle Class Tax Giveaways to the Ultra-Rich"?
Or is that too long.
By the way, the BC government just fell in a dual scandal. News at 11.
Or is that too long.
By the way, the BC government just fell in a dual scandal. News at 11.
2
I would trade 10,000 frothing cartoonish caricatures of liberals for one Paul Constant, but I'm not sure who would come out ahead in that deal.
3
I think the analysis is incomplete. Why is the demand "choose your poison" being asked of the Dems, and not the Repubs? I think with a more serious PR blitz, the nation could see it another way, that the Republicans need to choose whether they prefer to extend the tax breaks for no one, or just for the non-super-rich. I don't see why only the Republicans get to play the brinksmanship game. I don't think pointing out the the Dems could play hardball, as well, is a frothing-at-the-mouth position to take.
5
@1, your inability to get even the most basic facts about your own supposed homeland right continues to astound. The government didn't fall; the leader of the opposition resigned. Not the same thing by a long shot. Also, "scandal" isn't the word you want; "controversy" or "dispute" or "challenge" is more like it. And it wasn't "dual".
O for 3.
Will in Seattle: not only a terrible human being, but a terrible Canadian.
O for 3.
Will in Seattle: not only a terrible human being, but a terrible Canadian.
7
let's see if the deal can get around Sanders and Feingold. Both could easily stall this till the new congress.
9
"Extending tax cuts" is inaccurate.
I should hope that after ten years, the Bush tax cuts are now the current rate. And although they expire, depending on what happens, rates might increase for the wealthy and small-medium sized business owners - but nobody get a cut. Likewise, the democrats can't argue that extending the current rate for the wealthy costs 700 billion (or whatever) because the loss of revenue from economic activity due to higher taxes will likely offset the increased revenue from tax collections.
I should hope that after ten years, the Bush tax cuts are now the current rate. And although they expire, depending on what happens, rates might increase for the wealthy and small-medium sized business owners - but nobody get a cut. Likewise, the democrats can't argue that extending the current rate for the wealthy costs 700 billion (or whatever) because the loss of revenue from economic activity due to higher taxes will likely offset the increased revenue from tax collections.
11
Wow. 9 just has no clue. The benefit to the GDP from the 700B tax cut for the top 1.2-ish% amounts to maybe $210B.
Whereas spending that on general infrastructure improvements would benefit GDP approximately $1.302T.
Whereas spending that on general infrastructure improvements would benefit GDP approximately $1.302T.
12
@10, oh really? Then why is Obama inevitably going to agree to go along with an extension for all taxpayers? The answer is that he's being convinced by obvious facts and arguments. Don't worry, though, there is plenty of Keynesian this administration for you to smile about.
13
I am horrified by Republican behavior on this issue and I have expressed myself on Sound Politics in both the comments and Public Blog section.
There is no reason a Republican should hold up the tax cut for those making under $250,000 to "include more people". What kind of Commie crap is that?! Republicans should be opportunistic and promoting individual self-interest. I don't want some kind of +$250K Affirmative Action because its harder for those guys to get tax cuts.
The Hypocracy!
There is no reason a Republican should hold up the tax cut for those making under $250,000 to "include more people". What kind of Commie crap is that?! Republicans should be opportunistic and promoting individual self-interest. I don't want some kind of +$250K Affirmative Action because its harder for those guys to get tax cuts.
The Hypocracy!
15
@12, you can't even elucidate your straw man arguments intelligibly. Go away. Go hang out with Supreme Ruler here, you have a lot in common. Watch your back, though; I think he hides the bodies of his girlfriends in the woods.
16
@5 neither of the top two parties has a leader.
in fact, only the Greens do, and that, quite frankly, is a laugh.
So, in point of fact, I am correct, and you're just posturing.
in fact, only the Greens do, and that, quite frankly, is a laugh.
So, in point of fact, I am correct, and you're just posturing.
18
@17. Calm down. Not only For Will and me, but for you as well. Take deep breaths.Then have a martini, it's almost 5:00.
19
Fnarf, you do realize that Canada uses a Parliamentary system, and that the Party leaders are the Premiers and Prime Ministers, right?
So, in point of fact, since it's the party leader that is the leader of the province and the other party leader who is the leader of the loyal opposition, I am in point of fact, correct.
And you're an ignorant American who just got fleeced by your right-of-center Republican President who sold you out today.
So, in point of fact, since it's the party leader that is the leader of the province and the other party leader who is the leader of the loyal opposition, I am in point of fact, correct.
And you're an ignorant American who just got fleeced by your right-of-center Republican President who sold you out today.
20
@3 FWIW that's what Silver tries to explain. His main argument is that if the Dems threaten to let all the cuts expire, and then are forced to follow through on that threat, they raise everyone's taxes. Since this was the Dem's threat, the will get the blame. The Reps can hold out for full extension because, win or lose, they will be backing something more popular than expiration.
Basically, voters care more about something that directly affects them (eg tax hikes) than any ideals they hold (eg progressive taxation or deficit reduction).
Basically, voters care more about something that directly affects them (eg tax hikes) than any ideals they hold (eg progressive taxation or deficit reduction).
21
@20. I'm still not getting it. Each and every day from now until the end of congress. the Dems try to bring the partial extension up for a vote. The Republicans filibuster, because they want the full extension. To turn your terminology around, why then isn't it the Reps who are "threatening to let all the cuts expire"? Why isn't it the Dems who are "backing something more popular than the expiration"?
I'm willing to admit that there is a built-in asymmetry to the negotiating situation, but it hasn't been explained to me in simple enough language for me to understand it, I guess.
It's a card game. Are you so sure it's the cards that are different, rather than the skillfullness/ballsiness of the players?
I'm willing to admit that there is a built-in asymmetry to the negotiating situation, but it hasn't been explained to me in simple enough language for me to understand it, I guess.
It's a card game. Are you so sure it's the cards that are different, rather than the skillfullness/ballsiness of the players?
23
@21
-Why then isn't it the Reps who are "threatening to let all the cuts expire"?
Because that's not something they're willing to support under any circumstance. They would never threaten such a thing. If the Dems are going to even bring this up as a threat, clearly they don't hate it as much as the Reps. So if this happens, it would happen because the Dems hated expiration less than the Reps. So the Dems get the blame.
-Why isn't it the Dems who are "backing something more popular than the expiration"?
They are. But to get it, they would have to threaten something very unpopular. If the Reps called that bluff, things could be very very bad for the Dems in 2012.
-Are you so sure it's the cards that are different, rather than the skillfullness/ballsiness of the players?
Dunno. But I haven't heard how they can win with this hand unless the Reps cave.
-Why then isn't it the Reps who are "threatening to let all the cuts expire"?
Because that's not something they're willing to support under any circumstance. They would never threaten such a thing. If the Dems are going to even bring this up as a threat, clearly they don't hate it as much as the Reps. So if this happens, it would happen because the Dems hated expiration less than the Reps. So the Dems get the blame.
-Why isn't it the Dems who are "backing something more popular than the expiration"?
They are. But to get it, they would have to threaten something very unpopular. If the Reps called that bluff, things could be very very bad for the Dems in 2012.
-Are you so sure it's the cards that are different, rather than the skillfullness/ballsiness of the players?
Dunno. But I haven't heard how they can win with this hand unless the Reps cave.
24
Will, I am loving the way you've begun to use "in point of fact", and hope you can find a way to use it even more!
25
Everyone is misunderstanding what this Democrat plan actually was: It WAS continued tax cuts for everyone, just not to the same degree as before! Their plan would have continued tax cuts for all yearly income under $200,000 for the individual (or $250,000 for couples). So, under the Dem plan, the person who files individually and earns $200,001 a year would have only increased taxes on $1 of their income. This proposal was lacking balls from the start.
Or, as the Democrats would probably assert, it was geared towards compromise.
It's no surprise that the Republicans aren't interested in compromise.
Or, as the Democrats would probably assert, it was geared towards compromise.
It's no surprise that the Republicans aren't interested in compromise.
26
@25 Everyone understands the Dem plan. Silver is saying that although their plan is popular, their negotiating position made it very difficult for them to get it passed.
27
@26 I agree with Silver's argument, but I was pointing out that extending tax cuts to everyone was actually the favorite option for the Dems too. The difference in proposals being how much to extend the tax cuts to the rich, not whether to extend them.
28
The Dems are still in charge of the White House. They own whatever happens. This is the GOP trump card. They can walk away from the table with nothing, and the Dems own the resulting tax increase. This is why the GOP can do whatever they want: because, ultimately, they don't give a shit about what happens to America as a result. They can always blame it on the Dems instead of participating in a compromise.
30
If no action is take the cuts expire automatically. The Democrats should allow the Republicans to block the extension, then put their own, new tax cut plan on the table. That takes the initiative away from the Republicans and forces them into the position of denying the middle class tax cuts that the electorate wants.
It's two years until the next elections, now is the time for Democrats to show some backbone when there's still time to see the economic results. Extending the cuts for two more years means that on the next election cycle, Republicans can win by scaring people into thinking that if elected the Democrats will raise everyone's taxes.
It's two years until the next elections, now is the time for Democrats to show some backbone when there's still time to see the economic results. Extending the cuts for two more years means that on the next election cycle, Republicans can win by scaring people into thinking that if elected the Democrats will raise everyone's taxes.
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