Game of Chicken on Bush Tax Cuts Holds Economy Hostage

"$15 trillion of new wealth was created"

$15 trillion of new wealth created? It's this kind of voodoo that got us in this mess to begin with. Was $15 trillion of new "goods" created? No. What you see in that number are bubbles inflating. The same economic policy that allowed these bubbles to inflate, also allowed them to burst. In 2008, America just over $10 trillion of wealth (http://www.businessinsider.com/2009/2/america-lost-102-trillion-of-wealth-in-2008). What happened to all those jobs? The EXACT SAME tax policy has been in effect since 2008. Where are all of the jobs that this policy has created since then? Its not theory that the tax breaks aren't working. Its history. All you have to do is look at the numbers for the last two years. What you are seeing is the fundamental problem of that "growth" that you saw in the last decade. It wasn't growth. What grew? Numbers in a ledger. That's about it. What industry in America grew? Biotech maybe? The sad fact of the matter is that industry in America is dying, being replaced by China. And the reason for this has NOTHING to do with tax law. Times have changed, and so have the economic conditions of the world. How can America compete when the workers who built my iPhone just got a 30% raise and STILL only make $140 a MONTH?! These types of issues have been around for at LEAST a decade. America's response? More investment bankers. We responded by sending our smartest people to work, not innovating in technology, or industry, but innovating in creating derivatives and other exotic methods of investing. We responded by making better hedge funds. THAT'S where that wealth was created, and that's why we are in big trouble economically now.

But go ahead and think that cutting income tax for the rich will result in job creation. Go right ahead. In certain environments, you may be correct. This is not one of them.

Mike of IL 3:06PM December 03, 2010

"And there is plenty of evidence that lower tax rates, up to a point, on the highest incomes provides the biggest bang for the buck as far as stimulating the economy goes."

Please, show us this "evidence".

These rates brought us 0 net growth for 10 years. When rates were 39% for the top, we had huge economic growth (Clinton years). Here's a link to an article by Thom Hartmann that shows increased taxes will increase wages, as well as shrink the government: http://watts4u2.blogspot.com/2010/11/increase-taxes-to-boost-wages.html

Watts of NC 1:39PM December 03, 2010

"One idea is to link yet another extension of unemployment benefits to a package that extends the current tax rates on everyone for everything"

Gotta love this! The new paradigm of political compromise is that one party allows the other to increase the deficit by their chosen method, and in return the other party gets to increase the deficit by their chosen method. Brilliant!

John D of VA 12:32PM December 03, 2010

I do not understand the argument that Bush tax cuts were never 'paid' for. What happened was the government didn't stay within its means. 'Paying' for tax cuts and 'affording' tax cuts seems like backwards thinking. Passing tax cuts and then not staying within the associated budget is irresponsible and obviously causes a deficit. The tax cuts did exactly what they were intended to do. They stimulated the economy and tax revenue rose. What am I missing? Government gets a bunch more tax revenue and now the wealthiest have to bail the governments way out of their spending spree? It's time for the government to cut and cut some more until they create a surplus.

Darrell Hansen of UT 12:21PM December 03, 2010