[shezzy]

So..looks like the new fiscal cliff agreement has taken effect. Looks like FICA payroll taxes have gone up. Unless you make more then 400k a year you can thank the congressional republicans for it - Obama wanted to extend the payroll tax cuts. It might not be as bad as falling of the fiscal cliff, but I bet it will still slow this economy anyway. But I'm glad JP Morgan and others got their huge deduction. #workingfornothing

[jon.kiparsky]

The temporary tax cut ended. That's what happens with temporary things.

[macosxnerd101]

One of the tax breaks was social security. My parents were smart and stuck that money right back into their retirement plans. So now that it has expired, they don't really notice a difference in what they bring home each week. As jon.kiparsky said, the Bush tax cuts were designed to be temporary.

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It might not be as bad as falling of the fiscal cliff, but I bet it will still slow this economy anyway.

The fiscal cliff was a two part- spending cuts and tax increases. Government spending grows the GDP faster than tax breaks do. Losing both will indeed slow the economy. However, in order to pay down the deficit, the government (just like any other individual or household) needs to spend less and earn more to pay off debt. The real trick will be to grow the economy at a rate where Marginal Growth >= Marginal Tax Decreases + Marginal Spending Decreases.

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Unless you make more then 400k a year you can thank the congressional republicans for it - Obama wanted to extend the payroll tax cuts.

Just a short year ago, it was the other way around. I think everyone is starting to realize things need to change. In the Senate, Mitch McConnell met with Biden to discuss how they could accomplish this. The two were close from back when Biden was a senator. Even Harry Reid commented that the Senate Republicans were working in good faith, and that the problem was that their ideas were too far apart. I think blame goes more squarely on the House. Even there, a lot of Republicans supported the bill that was passed, even Boehner. Speakers usually don't vote.

The real battle will be in a couple months when the time the Treasury bought to prevent raising the debt ceiling expires. I'm hoping that since a lot of the Tea Partiers in the House were not re-elected, that the House will be more willing to compromise. I do know that the Senators from Virginia (Tim Kaine and Mark Warner) are working across the aisle to get things done. Traditionally though, fiscal issues are decided more in the House than the Senate.

[jon.kiparsky]

macosxnerd101, on 04 January 2013 - 03:33 PM, said:

As jon.kiparsky said, the Bush tax cuts were designed to be temporary.

Slight correction:
The Bush tax cuts were designed to be permanent, and were described as "temporary" as a piece of deceptive financial sleight of hand, because Bush knew they could never be passed honestly. So now they're permanent. Score one for the anarchist side.

The 2011 payroll tax cut was designed to be temporary, and was extended through 2012. Now they've expired, as they were meant to do.

[Python_4_President]

WHAT??!!! ARE YOU SAYING I GET LESS WORTHLESS NUMBERS ON MY PIECE OF PAPER NOW? Oh well.. We can always print more!

[jon.kiparsky]

I love it when the nutbag wingnuts can't even figure out what conspiracy they're yelling about.
Warm fuzzies all around when that happens.

[macosxnerd101]

Python_4_President, on 04 January 2013 - 07:15 PM, said:

WHAT??!!! ARE YOU SAYING I GET LESS WORTHLESS NUMBERS ON MY PIECE OF PAPER NOW? Oh well.. We can always print more!

Ah yes- we've found a fan of QE-infinity, I see.

[Python_4_President]

macosxnerd101, on 04 January 2013 - 05:36 PM, said:

Python_4_President, on 04 January 2013 - 07:15 PM, said:

WHAT??!!! ARE YOU SAYING I GET LESS WORTHLESS NUMBERS ON MY PIECE OF PAPER NOW? Oh well.. We can always print more!

Ah yes- we've found a fan of QE-infinity, I see.

QE? Is that what they're calling it these days?

[macosxnerd101]

That's what it's always been called when the Federal Reserve lowers the interest rate or dumps money into banks to stimulate lending. More money is less valuable, so it lowers the rate.

[ishkabible]

I'm confused as to who is on which side of the issue. Who is ok with the fed printing more money and who wants them to stop?

[macosxnerd101]

P4P seems against it because it's a conspiracy theory. I haven't stated my opinion on quantitative easing as of yet. The general public really understands monetary policy less so than fiscal policy, so they don't really have an educated opinion. Bankers are for it, as QE-infinity buys out their toxic mortgage-backed bonds, enabling them to lend out more money. The question really becomes- is more money in the system a good thing, should the Fed stop, or should the Fed raise the rate?

[atraub]

jon.kiparsky, on 04 January 2013 - 03:43 PM, said:

macosxnerd101, on 04 January 2013 - 03:33 PM, said:

As jon.kiparsky said, the Bush tax cuts were designed to be temporary.

Slight correction:
The Bush tax cuts were designed to be permanent, and were described as "temporary" as a piece of deceptive financial sleight of hand, because Bush knew they could never be passed honestly. So now they're permanent.

Are you suggesting that the US government would lie to us? That's just crazy.

[farrell2k]

A 2% payroll tax increase? Somebody set us up the bomb! You want Social Security with retirement at a decent age, you pay for it. Sorry.

I bet most here have no idea that the FED doesn't "print" anything.

This post has been edited by farrell2k: 06 January 2013 - 12:37 PM

[Python_4_President]

macosxnerd101, on 05 January 2013 - 09:43 PM, said:

P4P seems against it because it's a conspiracy theory.

You make me sound so mean to conspiracy theories... I'm not, really. I'm a nice guy... sometimes... occasionally..

[CTphpnwb]

I recently had a Tea Bagger tell me that the real problem was all these Americans making $50/hour when they should be making $2/hour to compete with the Chinese. He meant it too! He couldn't tell me where I could apply for one of those jobs so I can't let you all know too.