With the troops returned from Iraq and the economy keeping up its high growth rate we really will have a surplus - a big one. At that point what to do with it is the all Republican agenda of SS reform, repeal of the AMT, tax system reform, MSAs, etc. It's Contract with America II time just before 11-06 and the set-up for the crescendo for the last two years.

Their lies will really begin to fester, especially with SS and tax reform coming up (and no way for the Dems to do anything about it).

Krugman's cat should be nearing the Delta quadrant about now.

Is there anything left of Democrats arguments against the tax cuts?

Sure.

For instance, some of the tax cuts should have been in the form of a reduction in payroll taxes, which would have been immediately useful to everyone with earned income, especially to the working poor.
Such a cut would have been more broadly applicable, as well as more moral, than cutting the tax on dividends.

it's pretty easy to be giddy with a good month of receipts when you're running a $180 billion off-the-books expense program, innit boys? i gotta hand it to y'all, you run the kenny boy scam even better than he did himself.

I don't know. It looks to me like Greenspan is determined to raise interest rates until we're in a recession/deflation. Tax receipts might drop rapidly then.

Lonbud - good to have you back. Not that your statement contributes anything demonstrative, but good to have you back.

BTW - it's not just one 'good' month. The deficit projection has already dropped from above $425 billion to about $300 billion now. By the end of the year, it might actually be below $300 billion. Nice 29% reduction, eh?

P.S. - If you agree to private accounts, I'll agree to putting SS on the budget. Fair enough?

Isn't Greenspan's number up yet?

Now erp, don't try to put him in the ground just yet.

lonbud:

$180 billion is a bookkeeping error in this budget.

Michael:

That's an argument in favor of more cuts, not against the ones that worked.

That's an argument in favor of more cuts, not against the ones that worked.

The actual cuts worked; it would have been better had the gains been more widely distributed.
More cuts are unnecessary.

The Fed's share of GDP is still too high in historic terms, though lowish in post-Crash terms.

Let's run the experiment and see if your cuts generate as massive returns.

jim: thanks for the welcome back. i appreciate your horsetrading spirit, but it wasn't SS i was referring to as the OTB program. the only way i could be in favor of private accounts would be if i worked in the financial services industry. but even then it would be an immoral position to take.

oj: bookkeeping error perhaps, but $180 billion here and another $180 billion there, and pretty soon you're talking about real money.

this whole exercise in the redistribution of the commonweal can only end badly. gather ye rosebuds while ye may, gentlemen.

Welcome back, lonbud!

Anyway, I'm a tad confused by your last comment. You apparently object to "the redistribution of the commonweal" yet oppose private accounts for Social Security. Isn't the whole point of not having private accounts to redistribute the commonweal? So is it a good thing or a bad thing?

Amen to Herdegon. And here's another basic argument, that Orrin won't be able to see through with his rampant Dear-Leaderism

Bush averages 393,000 new jobs a year; Clinton averaged 2.9 million. I wasn't a Clinton fan, but he got this one right.

Rick:

Unemployment is already at 5% and dropping; if Bush had created the other 13 million jobs you want they'rd be no one to take them.

lonbud's $180 billion is for the war.

Rick: Was it a bubble or wasn't it. If it was a bubble, then feel free to give Clinton "credit."

Record-high revenues in any given month aren't remotely impressive. The economy keeps growing.

Heck, we can always hope that Bush fails and that the economy tanks....

But if that don't work out too good, we can always call Bush lucky.

Or, better, crooked. Or better 'n that, both!

And even if the economy does show signs of life, we can still proclaim it dismal.

There's gotta be some value in being loyal to one's cause.

AOG: it's redistribution when you take a big slice of the pie and give it to a particular industry to milk commissions and management fees from as the creation of private accounts would do for the financial services industry. and michael herdegon is absolutely right about the inequities of the payroll tax (let alone the sales tax). bush's entire approach to the taxing function of the gov't has been to reward those with the most resources at the expense of those with the least. and i thought he was supposed to be a big fan of jesus christ.

...whose greatest beneficiary was Rome, so we might not want to chase that too far.

As for payroll tax, do you mean withholding or FICA? Because I agree, withholding is nuts. Everyone should write a check to the government in April, not get one and think they've made money. As for FICA, pretending the social security benefits are "earned" because we give a special name to just another tax was one of FDR's most brilliant schemes. It accounts for nearly all of social security's political cache. Getting rid of FICA and making clear that social security is just middle-class welfare paid out of general revenue would be the program's qiuck death -- much quicker than the slow death the right hopes to accomplish through private accounts.

lonbud:

Christians are not 'fans of Jesus Christ'.

Where does Jesus mention tax rates in the New Testament?

It is good to have you back -- you're unintentionally hilarious statements are a great source of amusement.

David's right, lonbud. The slices that go to this or that industry are crumbs. Even the slice that goes to the genuinely poor is a sliver. Middle-class-to-middle-class cash transfers are where the real money is, and could be done away with, or so altered as to be unrecognizable, without having much affect at all on what Uncle Sam does for the truly distressed. Of course, you can't hold a governing coalition together by helping the truly distressed, so it would also be the end of the Democrats as we know them. Try to hold the thought that this might not be a bad thing.

lonbud:

No, you aren't. We've an economy so massiuve and power so great that we can fight this world war on just a month or two of tax money. It's not even heavy lifting.

Rick:

Of course Bill Clinton enjoyed greater economic growth during his presidency--that's the difference between a peace dividend and fighting a war. We'll experience another boom as this one winds down and we push defense spending back down towards 2% of GDP.

joe & oj: $180 billion bookkeeping errors, $300 million crumbs, yes, our economy is so big and massive and powerful that these numbers become meaningless for you, when in fact you ought (as so-called conservatives, to decry the waste and inefficiency they imply. you guys remind me of the big glutton in monty python's "the meaning of life." ...just a wafer-thin mint...

jon: it's the rare christian i've come across who understands much of what jesus christ taught at all, much less acts like a real "fan." dubya just thinks he (JC) is a marketing tool.

Just as a note on rhetoric, it doesn't really accomplish much to tell us that we're hypocrites based on something you think we ought to believe that we don't actually believe.

lonbud:

If Christ wasn't an advertisement for faith in God what was He?

A social justice activist, just like Rachel Corrie.

Who followed Rachel?

These people.

Nevertheless, I was just trying to channel lonbud. I don't personally believe in Jesus as social activist.

Suing DCaterpillar ain't flingin' rocks with the mob.

lonbud: you're quite right that we're not outraged by graft at the margins of the welfare state. If you think of graft as people who aren't poor using the political system to extract money from people who aren't poor either, then the thing largely is graft. That's because it was designed that way for reasons of political viability. The middle class supports middle-class entitlements, not poor relief. I leave the history of that as an exercise for you. That goes double for the cost of military campaigns. For one thing, they're a core function of the nation-state at least. For another, there will always be plenty of money for the security state as long as there's enough for the welfare state, at least in this country, for the same reasons. The middle class in this country isn't going to leave itself undefended if it can help it. Again, the federal budget is twenty three hundred billion dollars this year. If you don't like the Pentagon, and you don't like the idea of the well-off pocketing government cash, then your only course of action is to make that number a lot smaller.

joe:

We asked lonbud about freezing the federal budget a few weeks ago, and he blinked. No zealous (or fluffy) leftist can ever agree to this, which most of the right would jump on in a NY second, even with the WOT and Iran looming on the horizon.

The professional left requires an expansive federal budget, from which to glean crumbs. Shrink the budget just 0.5% from one year to the next, and then some hard decisions would have to be made, on which the left would lose.

jim: it's pretty interesting for you to critique the evolution of the federal budget so, when the presidents responsible for its most significant post-war expansion are the all-hallowed cowboy duo, dutch and dubya.

the much-villified bubba --the only democrat of note to philander in the oval office in the last 30 years-- presided over the greatest post-war expansion of the economy, while managing to keep the growth of the federal budget in relative check. and he left office with the first budget surplus in recent memory.

the only reason i blinked at your offer to freeze the budget was because you stipulated no rearrangement of allocations. given the relative size of the pentagon's pie, as well as additional entrenched programs of corporate welfare, it's a bad deal. now, you want to talk freeze and reapportionment, perhaps we can come back to the table.

in any event, you should refrain from trading in old school stereotypes of "leftist-tax-and-spend" and "conservative-fiscal-responsibility" because it's a lie.

lonbud:

He didn't check anuything. In the wake of the Cold War we cut defense spending from 6% of GDP to 3%--that's the entire shift from deficit to surplus.

joe: the middle class has alreadly left itself undefended and is in the process of being drowned in a pool of debt created and abetted by the graft, corruption, and usury of the temple's moneychangers. under the present circumstances, in a generation's time there won't be much of a middle class to speak of in this country.

we'll have the drug and titillation-addled wage-slave class, an increasingly rabid anarchistic class of ignorant youth who have no idea why they are mad at who, and an increasingly imperiled class of very wealthy, very comfortable folk with every modern advantage securely ensconced behind their gated communities, secretly praying that the private security forces they hire don't somehow decide to sell them out to the anarchists.

keep the present course and soon enough there will be a booming trade in guillotine manufactury.

lonbud:

Ah, the eternal faith that the unwashed masses are too stupid to know what they're doing. Fortunately, they have their vanguard....

oj: wasn't no we about it, friend. you and your ilk fought every cut in defense spending with howls of protest. who the heck are you trying to kid, brother?

The cuts began, of course, under Ronald Reagan and George H. W. Bush and were continued under a Democratic president, briefly a Democratic Congress, and finished by a GOP Congress. But when I say we I mean Americans. We always cut defense down to a bare minimum in times of peace. We'll do so again once the troops come home from Iraq.

oj: the unwashed masses are too stupid to know much of anything. otherwise we wouldn't be in the fix we're in today. then again, perhaps it's just an intelligent design thing.

lonbud:

You remind me of Whittaker Chambers's devastating take on Ayn Rand: a voice can be heard, from painful necessity, commanding: " To the gas chambers— go!"

I like the thing about guillotines though. He's out of his mind but at least he's got a flair for it.

Clinton also had, for 6 of his 8 years in office, a House controlled by the Republicans. Gridlock is a great conservative tool for stopping up government. It's a real shame that the Democrats can't be trusted with either branch for the time being.

The increase in tax receipts that resulted in the completely unexpected surplus came from capital gains taxes on the stock market bubble. No bubble, no surplus. In the mean time, the bubble and the social security surplus allowed the tax burden to be shifted from the middle class to the top quintile or, rather, the last 10% earned by the top quintile. Come the NASDAQ crash and those taxes went away.

oj: The cuts began, of course, under Ronald Reagan...

LOL!

David: Gridlock is a great conservative tool for stopping up government. as long as we're not talking about approving presidential appointments, right?

you guys are so full of it...

lonbud:

Reagan boosted defense spending to over 6% of GDP in order to end the Cold War, but had reduced it by about half a percent by the time he left office, the war won. It cost a bit to clean up the mess FDR and Truman left behind, but we've been enjoying the benefits for awhile now.

oj: yes, how could i be so daft? fdr and truman were the root of our problems, and as soon as we cast off the last vestiges of all they did to dampen the great engine of american ingenuity, we'll enter a new golden age, brighter and shinier than anything history has ever known.

The Clinton administration left no Federal budget surplus.

Nor did they balance the Federal budget - the "balanced budget" included the SS surplus, without a corresponding line for the current value of future obligations.
In other words, a fraud.

The "surplus" that financial illiterates so love to speak of was always a PROJECTED surplus, one that would have required TEN UNINTERRUPTED YEARS of economic growth to realize, according to the forecast.
Obviously, that would have been a best-case scenario under any circumstances, but the dot.com crash and 9/11 destroyed any possibility of the surplus being realized.

SecDef Rumsfeld is cutting plans for future defense spending as we write, but the only howls of protest are coming from the Pentagon and Congress.

The wage-slave class built the mighty nation of the U.S. of A., from the subsistence farmers of the Revolutionary Era to the railworkers of the Nineteenth century to the factory workers of the Twentieth century to the telecom industry's cubicle drones of the last twenty years.
However, "wage-slave" doesn't imply penury, it's about choosing luxury over freedom.

In a generation's time, the American middle class may not be far advanced from where it is now, due to the strain of tending to the Boomers, but in two generation's time, the American lower-middle class will live better than the upper-middle class does now, and the future's equivalent of today's working poor will live decadent middle class lifestyles.

Of course, the rich people of two generations hence will live in unimaginably luxurious and exciting ways, and the gap between their worth and the mean wage of the American hoi polloi will be greater than that which currently exists between a common American millionaire and a rural Chinese peasant.

Perhaps that is the source of pessimism about the future of the American middle class ?

Is it not enough that the middle class will expand and be enriched, even as the elite become demi-gods ?

Workin' so far....

Cash is real. Promises are bunk.

He's right, 'bud. I can remember going to a commander's call in '91 while the first Gulf War was wrapping up, and having our O-5 stand up and say, though not quite in so many words: you know, we've got more of you than we can use, so the three magic words are now Don't F*** Up. Had it not been for Desert Shield/Desert Storm we'd have had that sort of thing at least a year earlier. The drawdown was quite bipartisan, it was done at the earliest opportunity, and it was quite steep: there were 2.1 million people on active duty when I got in, about 1.4 million when I got out. Think about the headlines if some other industry had shed 70,000 people a year for ten years running.

Fortunately, there is a way to ensure that one's descendants are part of the Future Elite tm.

great link, michael. may want to watch that demi-god fetish, though.

joe: like all the big league players, the military/industrial complex is shedding as much of its human liability as fast as it can. more resources and technological armrature to benefit the demi-gods of which michael speaks.

oj: in the immortal words of steve miller: "yo cash ain't nothin' but trash...

lonbud:

Try buying your groceries with trash this week.

lonbud:

I rather think that tomorrow's mostly robotic military will benefit all Americans, not just those with the most to lose.