60 minutes = $188 million in new debt

[Stavros]

I don't know the history of it in the US, but in the UK it would have been close to impossible for a family on a low to medium income to get a mortgage before 1960 -the lending culture in the UK up until the late 1950s was intensely conservative. It was the Tory Prime Minister Harold MacMillan (1956-1963) whose government sponsored a major house-building programme which brought down prices and which, with a relaxation on lending, enabled people on middle incomes to get onto the property ladder -so yes, I agree that a house can be an important form of capital either for retirement or as a legacy, but historically in the UK it has been 'recent'. It was Margaret Thatcher who transformed housing into an aggressive part of the capitalist economy -generating cycles of cash flow that the derivatives markets lapped up as part of their own strategy of lateral expansion. Thatcher's strategy, as I have said before, was part of the 'Property is freedom' ideology, and she did force through the sale of council homes to their tenants, which subsequently meant that, with demand for housing in central London escalating beyond supply, people who owned a one-bedroom apartment in a relatively central area could sell it for ridiculous sums. The negative side of this strategy was that people 'bought' houses they could not really afford. In the erly 1980s I knew one man on an income of less than £20,000 a year who 'bought' a five-bedroom house in Surrey, he was spending all his salary on the monthly mortgage payment, his wife gave him exactly £2 a day to spend; he used to bring a sandwich to work for his lunch, and so on -I dont know if he ended up unable to pay the mortgage when interest rates went through the roof in the late 80s and house prices fell, but thats what happened to many. In the Blair era, a very long period of low interest rates and 0% deals on new buys brought people into the property game and again, many purchased more than they could realistically afford -we now have the worst of all worlds: people with houses whose value has not appreciated significantly, people in rented property paying extortionate rents, people who don't have a minimum of £15,000-20,000 for downpayment unable to get onto the property ladder. I would cap rents, but apparently that would make me a Stalinist; which I am not...in the end people who bought their own homes did not vote Conservative forever and ever, amen.

[Faldur]

$352 billion borrowed in 78 days.. cut, cap, balance....

[trish]

...and tax those making above a quarter of a million per year.

[Faldur]

...and tax those making above a quarter of a million per year.

So you can watch revenues go down like all times previous.. genius!

[trish]

Oh, so you increase revenue it goes away. On what planet do you live? When you step on the gas does your car slow down? When you let go of an apple does it fall up? Money flows from those who labor to those who profit from the labor. Production per laborer has never been higher. Profits are record breaking. Corporations are on a roll. There's no reason to expect them to create jobs when production is high and overflowing the coffers with profit. Hiring more laborers will just saturate the market. The wealthy don't create jobs. If they did we'd be swimming in jobs right now. The wealthy don't create jobs, demand for goods creates jobs. It time to raise the taxes levels to what they were during Reagan and Clinton, when America was successful.

[Faldur]

Oh, so you increase revenue it goes away. On what planet do you live? When you step on the gas does your car slow down? When you let go of an apple does it fall up?

When my car is using far more gas than I am adding eventually when I step on the gas the car dies. When I am giving away FAR more apple than I am picking eventually I do not have an apple to drop.

You could tax the worlds population and still come up short on our over spending. Almost every time taxes are raised revenues go down. If you want more revenue try putting the 38 million Americans who are without jobs to work. Then start taxing the 48% that are not paying anything to begin with. That will generate true revenue income.

And why your at it.. cut, cap, and balance for the win!

[trish]

So pick more apples.

[Faldur]

So pick more apples.

Were trying, but 48% of the people in the apple field refuse to pitch in and help. They refuse to help pick, and scream that we should get the apples from someone else.

[BluegrassCat]

From the NYT. We're raising the debt ceiling to pay for past expenses, most of which were brought on by Georgie Boy. I don't remember conservatives complaining then. In fact, the response from conservatives was "Deficits don't matter." Whatever happened to that?

& Faldur where is this magical example where raising taxes led to lower revenue?

[trish]

There are 100 households in the imaginary land of Zephina. The minimum yearly cost of maintaining a household is about 100 Zephcheks. A recent census shows that 50 households in Zephina have an income of exactly 100 Zs. Another 25 households have an income of 400 Zs; another 20 have an income of 1000 Zs and the remaining 5 households have an income of 10000 Zs. So the upper 5% rake in nearly 60% of the wealth (not unlike the U.S.). However, the tax rate in Zephina is 10% across the board. So 50 households pay 10 Zs each, 25 households pay 40 Zs each, 20 pay 100 Zs each and 5 pay 1000 Zz each. That’s a total tax revenue of 8500 Zs. The upper 5% of households paid nearly 60% of the taxes, whereas the lower 50% paid just under 6% of the taxes. Is that fair? Of course not, because the lower 6% are now unable to maintain their households. One reasonably fair solution is to exempt the lower 50% from paying taxes and increase the taxes on the wealthier Zephinians (from 10% to 11%) just enough to cover the mere 500Zs which are currently being contributed by the poorest households. Another fair solution would be to spread that burden over the top 25% of households.

References:
http://money.cnn.com/2009/09/30/pf/t...axes/index.htm

http://www.nytimes.com/2010/04/14/bu...leonhardt.html