Your 401 has never been better.

You are in the minority then. I am happy for you, I wish I would have got out of the Science and Tech Fund a couple of months earlier.

Diversifications the word, a bit of luck also.

Diversifications the word

You got that right

I was playing my 401 a little to much like I was at Vegas

Leadthrower...did you buy MS @$108 tsk,tsk,tsk

(Oh crap so did I...DOH!)

(DISCLAIMER: Ramon VB is off the clock; he is expressing his own opinion and not representing ANY organization, especially the one he works for.)

The one thing that bothers me about this debate is that it is argued as if a tax cut were the only way to stimulate an economy. In fact many economist believe that it is not a very good way to stimulate an econmoy out of recession, because it takes to long. By the time the money is distributed, and then spent/invested, and then that effect trickles down (remeber that old chesnut?), the recession will be long over, and if not then by that time we'd be in deep enough doo doo that the tax cut wouldn't be the right approach anyway.

When you pay your taxes to the government, it doesn't just burn the money. It uses it to do things, pave roads, build bombs, conduct research, make sure planes don't bump into each other, put out fires, arrest criminals, subsidise farmers, take care of poor sick people, etc. All those things employ people (mostly in the private sector) and create and protect economic activity. Now we can argue about whether the government should do those things, or whether it can do them well, but it is unfair to carry on the debate as if government spending does nothing for the economy, or as if the govt is simply papering its offices with your tax dollars.

In fact, many very credible economists believe that a govt stimulus (spending) package is a much more effective way to jump start an economy, and it is a FACT that the last time we went down the road we are currently headed down (the Reagan years), it really screwed the economy bad, and it took a very big tax increase to get us back on track.

And finally, one thing the govt generally does not do is run some kind of nationwide ponzi scheme that empties everyone's retirement accounts and puts the money in the pockets of literally dozens of individuals, a la Enron or the tech bubble. Think about what that's going to do the workaday economy when that effect begins to take hold. I'm sorry, I think I actually trust the govt more (as long as it's not WDFW -- sorry, back on the clock for a second there).

Racerdan;

To answer your question of how should we stimulate the economy. IF we assume a stimilus is needed, I think the fastest bang for their buck will be to do a cut for all those grossing less than $150,000 per year, and to cut them a check immediatly. I beleive this group of taxpayers is likley to immediately spend the money, instead of tuck it into the family trust account. This will give an instant stimulus and will help those most in need.

As far as how economist feel, I'm sure you can find any opinion you want, but our Federal Reserve chairman, appointed by both democrats and republicans, says this plan won't work.

I am not eager to soak the rich, but when it comes to helping out a taxpayer, I favor the small guy. BTW our rich are by no means soaked. Almost all other wealthy nations tax the rich at far higher rates then we do. And the rate our rich now pay is a considerably smaller percentage than a few decads ago.

You sure about that?

I always liked the idea of taxing everybody the same.Go to a flat tax rate and cut the loopholes so that everybody pays their fair share.Too many loopholes too much money falling through the cracks.Look how much easier a flat tax would be to collect ,figure, and enforce.
Also cut the fat where it needs to be in gov spending.

I think you would see the economy start to turn pretty quickly.

More than who? Its like saying i dont trust the ATF but i trust the FBI. Then again im not suing the ATF.

"and it took a very big tax increase to get us back on track."

I believe that was the infamous "READ MY LIPS" tax package you are referring to...

Lead Thrower,

The one thing you have to watch out for is the definition of " The Rich" used by people who are opposed to not only this tax cut but all tax cuts. You might be suprised at what income level is thrown into this category. All that aside if you multiply your $100 per person by ,1/4 of the United States population, 75 million people you get a pretty big number in the aggregate. So, maybe it is not that bad of a thing in total- which I think is the point.

Ramon vb - agreed that there are plenty of experts on both sides of the coin on this one, but one fact you left out is that the Regan tax cut did increase revenue, the problem was that the spending increased by more. A decrease in spending along with an increase in revenue is needed.

Surecatch - The rates in other countries may be higher but that does not tell the complete story. For example, how do you get to taxable income in those countries? Does a person there get more deductions? In some of these countries that is true and in these cases there effective tax rate is actually lower. Back when our tax system had higher rates, people were allowed more deductions from taxable income. Remember being able to deduct your credit card interest? In addition, the phase outs for itemized deductions were not as low as they are now allowing for more deductions from taxable income than are allowed now. Most wealthy people are phased out of a large percentage of their itemized deductions.

I am not saying a tax cut will pull us out of the slump, but it will, as history has proven, provide an increase in gov't revenue.

Okay, I've got to weigh in on this (thanks Grandpa for the motivation!!) I think that this particular tax cut is not in the best interests of the long-term economy. I too remember the big tax cuts of the Reagan Administration, the deficits that were created, and the tax package that cost George Bush I his job. Deficits in and of themselves are not the biggest concern, it is what they do to the credit market that causes the biggest problems. Once the Government becomes a huge debtor, means of Credit begin to dry up for everyone else and that means an increase in interest rates (simple supply and demand).

It would be interesting to see when the W supporters on this board start calling this his recession. Does it take two years of stewardship, four years, how many? Although, to be fair (if a liberal can be fair!?!), a President has very little to do with the cycles of the economy. His or her greatest contribution is how to deal with an up or down economy once it presents itself. I have noticed that our economy (since the '70's) appears to be in a cycle where the first few years of the decade are down and the last few years are up. Not sure if its coincidental or a true cycle, but interesting nonetheless.

OK Grandpa, now you have to weigh in. Catch those lings, find Ramon (just kidding), and educate the great, huddled, liberal masses!!!

I won't claim to be an economics expert, but I do have a Bachelors degree in the subject.

I think the US is suffering economically because of stagnating growth and overall economic pessimism by both consumers and businesses. Because we are pessimistic, we are cautious in our spending habits.

In addition to these issues, we are having some degradation of our infrastructure: our roads, ports, industrial areas, and schools.

My recommendation is that we hold taxes the same, or perhaps mildly increase them, and create infrastructure improvement programs focused on rebuilding the basic transportation infrastructure that serves american business. I'd also like to see us improve funding for secondary, vocational, and college education for low and middle income families.

This would create and maintain a large number of middle income jobs. That would stabilize cosumer demand, which would improve business confidence. The education programs would also contribute to a stronger workforce, maintaining american competitiveness, and again, increasing business confidence.

If business confidence increases, investment will increase, and that will have the long term effect we are looking for.

I forgot to say, I am 100% against this tax cut, and most tax cuts, unless and until the budget as balanced and remains balanced after the cut. The current adminstration's agenda is as clear as it is selfish - bankrupt America for the benefit of the already fortunate. And if in the process of bankrupting America we can force the rollback of every social progam ever enacted, well, all the better.

This country is headed towards a fiscal trainwreck. 70% of the federal budget is driven by non-discretionary items such as medicare and debt payment. As we increase the federal debt through these massive deficits, we reduce the funds available for these programs, as well as the discretionary programs, such as the military and homeland security.

If the debt grows by $300 B, interest payments grow by about $14B. If the debt is funded by the 30 year treasury bill, that means that for the 300 billion dollar shopping spree this year, we get $420 Billion of nonproductive drag on our government over the next 30 years. Ultimately this has to crash. The most likely scenario out of the crash is for massive inflation to reduce the real value of the debt. The government could print money to pay the debt, which would devalue the dollar, bringing the real value of the debt down to a size that could be managed. However, it would likely destabilze the economy in the meantime, and could well cause political instability.

That is what happened to Germany after the massive wartime reparations debt in the 20's leading to the rise of Hitler. That is what happened in Argentina in the past ten years.

Another aspect of the agenda to reduce government spending through banrupting the government is that it will likely stagnate the economy. Those dollars that we give to the poor through social security, welfare, medicare, etc, don't dissappear into mattresses. They are a major element of consumer demand. If those programs dry up, consumer demand will be reduced by that amount. We have our various opinions about whether that is worthwhile, but the impact will definitely not be a stimulus on the economy.

So, Bush's team is not impressing me in their economic performance. Rather, they scare me to death.

Would that we could get McCain in 2004.

according to the tax brackets the top 1% may pay the vast majority but you also have to understand that the more money you have the more places there are to put it where it can avoid being taxed..

1, the first tax cut did NOTHING for the economy and didn't help anyone( that I know of) What would help me is full time work!!
What will make that happen?? When people are out buying fly rods or wanting to pay for a fishing guide.. That's not going to happen unless they are working!!!!

I'd support a tax break if it directly went to companies hireing people!!

Consumers are the driving force in our economy.. if people aren't buying things because they don't have jobs then they cannot spend money...

here is how we fix our economy..

1 we choose NOT to bail out the airlines or any company ever again.. They are a waste of money. A company stays in bussiness by offering a product that people want at the price they want. Many airlines don't offer that. That is why they go out of bussiness..

2. Give a tax incentive for companies to hire people!!!! Not just give them tax breaks to pad their wallets..


3. Get GW out of the white house. He is no saint. and the only redeeming person in his cabinet is Colon Powell. That man has more charecter than everyone else on the cabinet combined.. OK now i am done telling you how i feel about the worst president in American History.

Here's another take on it. Since we are in debt and running a deficit. The question should be how many people feel it is correct to give an IOU to my 2 year old daughter so that you can spend that money this year. She will have to pay for a portion of the country's debt and I wonder what she has done to deserve that.

Just another take on it.

This tax cut is has absolutly nothing to do with fixing the economy. If it did there would be a framework to immediatly put money into consumers hands and it would not be designed to last ten years. Does Bush really think we will need a stimulus in ten years? Maybe so, if he's in office another term!

Will one of you conservatives please explain why the balanced budget amendment was so wrong. When you had a democrat in office that ammendment was consider the cornerstone of conservative policy. What happened?

If you were wrong then, maybe blindly following Bush in a tax cut widely denounced by bipartisan economist may be wrong now!

Why should we let our grandkids pay for our greed.?

He's probably not the worst, but IMHO he's somewhere down in the bottm 10.

Now I must add my opinions. Please remember that it doesn't matter, just like my vote. Yet, I do them both anyways.

Lead Thrower - read stadle's post

Timber Man - your talking to a brick wall (Democrats, liberals and Socialists). Its called cause and effect. Unfortunaltely the liberals are so narrow minded they can only see the present. The effect - Recession. The cause - an eight year Clinton administration.

Stadle - Good post, a perspective that everyone can understand. Hopefully.

CWUgirl - Keep taking those econimic classes. They're working.

Racerdan - That is funny. Yeah, and maybe we could spend a few more million on the mass transit project. Last few were well spent. The only things those dill holes know what to do is make poor decisions with your tax dollars. If Locke had a brain he would be doing every thing imaginable to keep businesses in this state. But he's not. The only reason Boeing is still in Washington is because the largest building in the world sits in Everett. They can't afford to build another one.

Oh, for all of you Clinton lovers that think he was the one responsible for reducing the deficit, do you remember who the speaker of the house was durning his administraition. I do, Newt, he was the man who should be givin the credit for the deficit reduction. Oh yeah, but he's republican.

A note on the dividend tax cut, I am all for it. Did you know there is a double tax on dividends. The tax cut elimenates only half. Will it directlly affect me, no. I don't have any investments that pay dividends. The sole purpose of the is tax cut is to stablize the stock market. Now that will effect me. I sure would like to see my retirement investments come back.

Well I think I my have blown enough smoke up your behinds. I am just a fisherman. There for, everthing I say is a lie.