Anybody participating in a tea party today?

http://www.heritage.org/research/taxes/wm2240.cfm

The Making Work Pay credit, or any new credit, will fail to stimulate the economy because government spending cannot create new purchasing power out of thin air.[4] The money that would go out through this credit would have to be taken out of the private sector by either taxing or borrowing, negating any effect of new government spending. The only sure way to stimulate the economy is through permanently lower tax rates, because they improve taxpayers' incentives to create income through working, saving, and investing.

 

I do payroll for a small business and this is exactly how it was explained to me.

 

The last statement you made is the reason such taxes are justified, we have also just printed 2 trillion dollars in borrowed money in the last 6 months. The government increasing the taxes on certain things now so we aren't spending a another fortune on interest later. I understand times are rough, I'm have a tough time as well with work and school (school isn't getting cheaper either) and paying for the commute back and forth (gas is creeping up I'm sure you've noticed). Granted I don't have kids to take care of or a house note (I rent) so I can only imagine how bumpy the road is for you. However, what would you suggest we do about paying off our massive debt and keeping that debt as our problem and not our childrens?

 

The brackets haven't changed, but you get a credit, a real credit, that is spread out over the year thru reduced payroll deductions.

Here's the official IRS explanation:

In 2009 and 2010, the Making Work Pay provision of the American Recovery and Reinvestment Act will provide a refundable tax credit of up to $400 for working individuals and up to $800 for married taxpayers filing joint returns.
This tax credit will be calculated at a rate of 6.2 percent of earned income and will phase out for taxpayers with modified adjusted gross income in excess of $75,000, or $150,000 for married couples filing jointly.


For people who receive a paycheck and are subject to withholding, the credit will typically be handled by their employers through automated withholding changes in early spring. These changes may result in an increase in take-home pay. The amount of the credit will be computed on the employee's 2009 income tax return filed in 2010. Taxpayers who do not have taxes withheld by an employer during the year can also claim the credit on their 2009 tax return.

 

its a mathematical impossibility to spend your way out of debt or a recession and that is exactly what this administration is attempting to do.
there is something seriously wrong with this headline.

GDP, Federal Spending Now Equal

add to that this,

Household Debt (Alone) Now Equals One Year's (Total) GDP -


and youve got one fucked nation. you cannot spend your way outta this one and you cant squeeze blood out of a turnip either.
the whole country is in over its head.

 

Yes, I've noticed gas creeping up again, and I've also noticed utilities going up, as well as groceries continuing to climb. I'm telling you, I can't get over how much it's costing to keep food in the house lately, or how little you get for how much you spend.

We own our home, but of course we pay a mortgage.

Thing is, I don't know what the long term solution is, all I know is I'm afraid, afraid for us, afraid for the future...things can't keep on going like they are, prices just go up and up, we're being taxed here, there, everywhere...how is the economy supposed to get back on it's feet if more and more money is being taken from their pocketbooks? I mean, seriously?

I don't think there is an easy answer...which is the most frustrating part of it all.

 

You are just flat-out wrong. The great majority of top economists agree with Obama's approach as the only way to get the economy moving again. In fact, most of disagreement you hear is from those, like Nobel-Prize-winning Paul Krugman, who think that Obama should spend much more.

 

Didn't we spend our way out of a recession during WWII.

 

Absolutely correct. And it worked very well.

 

It's ok if you think I am wrong, hell I probably am. However, I find your statement above about Obama's approach as the ONLY way to get our economy moving again is extremly close minded.

 

The only alternative I hear from the Republicans is basically what you say -- lower taxes, lower taxes. They are bound by their ideology to say that. They are the ones who are extremely closed-minded.

The trouble with this alternative is that it is very hard to find a reputable economist who is not from Texas (ahem) who thinks it would work.

 

You didn't have to put Texas in this, we already have to deal with Bush being back.

 

Sorry, man.

 

i as well as others see a big difference in where we are now and world war two.

this kinda sums it up for me..

http://www.washingtontimes.com/news/2009/jan/19/economic-crapshoot-ahead/

 

so what happens if china quits buying our debt,or worse calls in, cashes in the debt (treasuries) they are holding now?

 

Thanks for posting that.

I guess I would agree that we don't really know what we are doing. Conservatives would say -- well, then we should be conservative and err on the side of doing too little. The trouble with that is that hardly anybody thinks that would work.

Progressives say, well at least we can get some things done that we should have done long ago, like fixing roads and bridges and schools, and developing renewable energy, etc.

It is a crap-shoot, but for me, I'd rather go with what most of the best experts say: huge stimulus is what is needed.

 

Hmmm he gives no solutions and is he including the fact that our present state economy is not as bad as the state of the WWII recession so we shouldn't have to spend as much. Well in any he makes a good point but he implies some action should be taken and so far his action are the best they can come up with.

 

Why would they? Their economy is directly affected by ours, also I'm sure they have internationally bound contracts which have an expiration date.

 

sorry folks,i see this was moved to politics.
i would love to continue the conversation but i aint gonna do it here.