Glenn makes a fun point. The POTUS spoke in the SOTU on earmarks right at the beginning. Porkbusters anyone?

Harrison Bergeron has the quote of the night:

“Others have said they would personally be happy to pay higher taxes. I welcome their enthusiasm, and I am pleased to report that the IRS accepts both checks and money orders.”

UPDATE: Heh!! Welcome Instapundit readers! Be sure to click through to Harrison’s Three Sources blog.

Based on the comments here I thought you all might be interested in the CBO numbers released today: (via the Wall Street Journal)

The tax rate fell to 15% from 20%, yet revenue collections have climbed by 152% in four years

(from 2002-2005)


This blowout in taxable gains has in turn translated into a revenue windfall for Uncle Sam. CBO now estimates that the capital gains tax will collect $127 billion in 2007, up from $49 billion in 2002. Capital gains revenue has undeniably been a major contributor to the decline in the budget deficit in recent years.

Ah, but wouldn’t revenues have been even higher with the 20% rate? With the help of the Strategas consulting firm, we went back and looked at what CBO predicted for revenues assuming a 20% rate. CBO estimated that from 2003-2007 the government would collect $260 billion. In fact, the feds have collected $470 billion over that period at the lower 15% rate. Even Tom Brady doesn’t do that much dynamic scoring.

And by the way, the capital gains rate is scheduled to return to 20% at the end of 2010 unless Congress acts in the interim. Hillary Clinton wants to raise it back to 20%, while Barack Obama and John Edwards say it should go as high as 28%. Apparently they don’t mind if the government loses revenue.

I’m just saying.

21 thoughts on “SOTU

  1. It was a funny line. Apparently, some of the comedy writers crossed picket lines……just for the SOTU night.

  2. Actually from what I’ve heard, the President has a very funny sense of humor.
    Maybe he pulled a Jay Leno and wrote his own standup.

  3. So, get a Instapundit link and you are now the big deal… Well, us little people remember when you were known for calf blogging!

  4. Warren Buffet left his money to Bill Gates so that he can write off a bundle, cheating Uncle Sam (i.e. us, the citizens and tax payers) a big chunk of taxes that Buffet “would personally be happy to pay “.

  5. I don’t know necessarily that Buffett is “cheating” U.S. taxpayers as much as he’s simply a cynical hypocrite. It’s true that by pledging the majority of his fortune to the Gates’ foundation he’s promising to perpetrate the second-largest tax dodge in world history. The man’s clearly not stupid — you don’t get that wealthy being an idiot.

    I have a real big problem characterizing death as a taxable event. Buffett doesn’t — for OTHER people who can’t afford to do much about it(typical leftist ideology). He built a good share of his non-liquid empire precisely through estate taxes — or more accurately, off the consequences thereof. Take your kids to Dairy Queen after their ball game? Warren Buffet is your host. Wear Fruit Of The Loom briefs, boxers, or tees? Warren owns the looms. Buy your wedding set at Ben Bridge Jeweler? That’s Buffett in the back office.

    What do those companies (and dozens of others) have in common? They were all closely-held and family-owned enterprises which, when their founders passed on, couldn’t both satisfy their estate tax liabilities and remain well-enough capitalized to continue business operations. So in swoops an “angel” (in very thin disguise), Berkshire Hathaway, paying knock-down prices for the businesses (essentially little more than the estate-tax bills themselves) and Buffett has yet another brick-and-mortar under his belt.

    But it’s okay — no, it’s their DUTY — for people of wealth to pay higher income and estate taxes.

    Just so long as their name isn’t Warren Buffett.


  6. Congrats on all of the links! Can’t find the source, but am 95% positive the statement about people being willing to pay higher taxes is a reference to a statement by former President Clinton. I remember him saying it within the past year.

  7. Ummm . . . It would be nice if people at least tried not to seem as foolish as the sitting President. The sleaze concealed by his quip is that the widespread view he references tends toward “I’d be happy to pay more taxes if we fixed our crumbling infrastructure” or “I’d be happy to pay more taxes if it meant less sickness and injury.” Simply dumping a bundle of money on the IRS today means much of it will go to unnecessary warfare, not to mention subsidies for already-profitable energy firms, ridiculously expensive and basically irrelevant continuations of the Cold War arms race, et al.

    It was an attempt to exploit the gullibility that causes people to believe there is something wrong with asking for a higher social minimum in the United States, even though that is a perfectly legitimate area of policy debate. To simpletons it seems that money just springs from acts of will performed by corporate executives — laborers and the rest of American society be damned. To people with a less infantile view of economics, there are real interdependencies and all manner of reasons, pragmatic as well as altruistic, to improve conditions for America’s least fortunate citizens. For people unwilling or unable to engage in substantive discussion of that subject, it takes nothing more than a marginally humorous line to make it seems as if cutthroat economics is wholly vindicated. I’d like to think, as a nation, we could set the bar of civic discourse at least a bit higher than that.

  8. And they say that liberals have no sense of humor.

    Come on, Mr. Demonweed, it WAS a funny line.
    You have to be pretty deranged not to give it that.

    Many people DO understand a lot of the complexities of the taxes/economy. (particularly on this site)

    Especially as they watch the economy improve, opportunities multiply and tax revenue increase as taxes go down.

  9. what is wrong with you people? First of all, the line was about as original as his plan to go to war (uh, didn’t his dad do that too? ka-ching for the bushies).
    Secondly, it wasn’t funny. And thirdly, he didn’t even deliver it well.

    It looks like Terri’s the one who’s deranged if she actually believes her last sentence in her last comment (as opposed to just spinning these lies, as many others do).

  10. “To people with a less infantile view of economics, there are real interdependencies and all manner of reasons, pragmatic as well as altruistic, to improve conditions for America’s least fortunate citizens.”

    Yeah, except that when it’s done literally at the legal equivalent of gunpoint, it ain’t altruism; it’s theft. That word has a meaning; most immediately to the discussion at hand, it’s a self-directed act. It isn’t, “This is what you owe — pay up or we’ll put your business up for tax auction.”

    I’m a small business owner, you know, those of us with fewer than 50 employees who provide 75% of the jobs in this country. Tax liabilities have forced me to lay people off — several times. And not as an alternative to maintaining my current lifestyle (which is by noone’s measure extravagent), but simply to keep the damn business capitalized.

    My view of economics is far from “infantile”. I live this stuff every day. I can’t afford an “infantile” economic perspective. If I screw up, my employees are out of work and my kids go hungry.

    Macroeconomics isn’t a zero-sum game people, and static, “snapshot” analysis inevitably fails the smell test. Certainly there are folks who need and deserve our help; unfortunately, there are a lot more who’re getting it who shouldn’t be.

    To paraphrase Henry Ford, for too many, opportunity wears overalls and looks like work. In more cases, they refuse to assume responsibility for the consequences of their own failed behavior, and politicians use other peoples’ money to buy themselves constituencies by relieving the masses of having to suffer those consequences. In a halfway sane society, that’s not my responsibility.

    And I’m STILL trying to find that portion of the Constitution which authorizes the Federal government to apply the tax code as social engineering.


  11. Wow! not only did you get a link from Instapundit, you have also been called deranged! I’m guessing you’ll have your own dedicated lurkers too! Pretty soon, you’ll be spawning CBDS, Calf Blogging Derangement Syndrome

  12. Dear Comewhatsay,
    See the update. The Democrat head of the CBO released those numbers. Yes, I believe them.

    And yes, it was a Bush joke. And worth a chuckle at that. BFD that he’s not the best speech giver in the universe.

  13. I do not believe the President is a child or suffering from a developmental disorder so severe as to leave him locked forever in a childlike mental state. As such, I believe it is a disservice to treat a failed attempt at comedy as if it were some sort of success. People never learn to be funny if they are spoon fed laughter for one unfunny effort after another. In dealing with mature adults, the only useful feedback is honest feedback.

    Perhaps this is why we have so many people convinced that “tax cuts create growth” is some sort of magical universal truth. Yes, there are some specific contexts in which tax cuts may promote economic growth. Then again, even that goal is poorly understood by most Americans. If we deliberately destroyed all our great cities while waging a perpetual war to the maximum extent our resources permit, the destruction and rebuilding would register as downright fantastic GDP. Yet would anyone actually be better off as a result?

    Of course no social spending program is metaphysically perfect. However, it is a common thing for pundits and politicians to bemoan a trivial fringe of waste and fraud in order to generate hostility toward a core of genuine usefulness. Education subsidies, infrastructure development, poverty relief, retirement security — each of these areas are fertile ground for policies that, while costly, ultimately produce a stronger economy.

    Instead of worrying about the cost of universal health care, we should be recognizing the greater losses our economy sustains for the absence of some reasonable means of upholding a minimum standard of public health. Workplace absenteeism, underemployment, underperformance on the job — all of these phenomena are worsened considerably by a preventably ailing population.

    Even the richest of the rich cannot realistically hope to be untouched by contagion and other public health problems fostered by our nation’s perversely cutthroat approach to funding basic medical services. All too often, the purported savings is also absent, as problems that could and should be addressed through health maintenance instead become crises that devour costly emergency medical resources or end in messy deaths with their own associated public expenses.

    Now, I can’t be sure that Mark B. doesn’t live in some oddball jurisdiction where sudden new taxes are constantly arising from unexpected directions. However, normally tax policy is established clearly enough that business leaders are not blindsided by the law. In the context of that norm, well-run business will thrive and badly-run business will falter. Isn’t that the essence of capitalism?

    Perhaps the most important thing to consider in all of this is that there is no such thing as a tax cut without a spending cut. All of the sitting Presidents “tax cuts” are in fact tax deferments. The debt does not simply vanish if neglected. In fact, it grows alarmingly when neglected as it has been during this wave of clumsy and irresponsible tax rate reduction. Barring the even worse outcome of total collapse, the bills must be paid at some point in the future.

    With that in mind, deficit hawks would do well to look at where the actual waste is in our government. If someone told Osama bin Laden in 2000 that twenty men with boxcutters could motivate America to spend hundreds of billions of dollars it otherwise would not have, he might have replied, “I can’t believe they would really be that stupid.” No doubt a little of that spending is justified — regime change in Afghanistan was a sensible goal, and transportations safety required some upgrades (though clearly others are merely painful placebos.)

    If you really want to see America on course for sustainable tax rate reductions, then you should really want to see America stop spending obscene amounts of money on fundamentally useless programs. Only a fringe of gullible Americans does not already know that the missile defense shield cannot actually defend against missiles. Rather than continuing to focus on a reasonable R&D effort to develop the technology, tremendous amounts of money are being spent on constructing this glorified national scarecrow. The same can be said for an assortment of high tech weapons programs that constitute a unilateral arms race. We continue to beat the Soviets even though they no longer exist — but the price tag for next generation warplanes and other irrelevant showpieces is a substantial contributor to government overspending.

    None of this is to say we should fail to be strong on national defense. However, it is vital to recognize the difference between being strong and being stupid. Expanding our special forces capabilities is a good idea that should continue in the present geopolitical context. Better pay and benefits for service personnel is also a goal that deserves public support. Innovative military hardware also has its place — provided that it serves some sort of useful purpose, rather than simply squandering another pile of billions on uselessly running an arms race no other nation is foolish enough to run alongside us.

    If we had the integrity and good sense as a nation to trim the real waste in federal spending, we could sustain lower tax rates while also pursuing sensible initiatives to improve the quality of life for all Americans. No doubt there are some social programs that do little good and could be cut, but hostility to all social spending without even a hint of awareness about the abominable bloat spewing out the Pentagon year after year after year is not really helpful. I continue to believe it is the duty of any conscientious citizen to set a higher bar than that in the realm of civic discourse.

  14. Here’s the deal Mr. Demonweed,
    Your first comment was concerning the joke
    by a “sleazy” “foolish” man.

    “It was an attempt to exploit the gullibility that causes people to believe there is something wrong with asking for a higher social minimum in the United States, even though that is a perfectly legitimate area of policy debate. ”

    You chose to imply that because this simple joke played well with conservatives they must be simple minded.

    I’m trying to explain to you that that is not the case. There is as you note many philosophical differences amongst people concerning what we spend our tax dollars on, how they are to be collected and how much.

    You suggest that education, poverty, healthcare and retirement subsidies all help the economy. There are many who would disagree. Schools are failing children, welfare does not help folks out of their cycle of poverty, subsidized healthcare turns into subsidized administrations and retirement funds are not sustainable.

    And yes, taxes do get raised quickly. Not blindsidedly, but centimeter by centimeter until pretty soon you need to lay someone off because you can’t afford the taxes. We have millions of illegal immigrants here not only because they can find work but because employees hire them when they can’t afford to pay all the legitimate taxes that go with each legal employee.

    There are tons of places to cut waste and the pentagon is certainly one of them. On Universal Health care you note:

    “Instead of worrying about the cost of universal health care, we should be recognizing the greater losses our economy sustains for the absence of some reasonable means of upholding a minimum standard of public health. ”

    and yet we DO have minimum standards of public health without the government taking money from some to pay for all. (instead the hospitals charge more to cover all)

    If you break your arm or come up with cancer and have no insurance you will be taken care of if you enter into the healthcare system.

    When was the last time you heard that the VA hospital system was the best around? That would be government run healthcare. Putting more money into these programs do not automatically equate to better services.
    Yes, I believe it COULD, but unless it happens ever you’re going to have a hard time convincing people that the best solution is to hand over their money.

    As a side note, Medicare Part D is an example of government spending on the private side that has proven to be an efficient method of dispersal. The actual costs to the program have been less than projected every year it’s been offered.
    (and many conservatives do not like this program either)

    Again, these are differences in opinion that can be “exampled” with real life scenarios out the wazoo.

    The “joke” in the state of the union was aimed at people (Bill Clinton, Warren Buffet) who think they don’t pay enough in taxes. I’m happy to hear that everyone you know can tell a joke with ease but being a half ass speaker does not make someone a moron.
    Or unthoughtful, or simple or unable to understand economics. You don’t need to laugh. I thought it was a good line and it was.

    I believe that civil discourse IS happening during these times and during this election when you have one side that most definitely wants to raise taxes and spend on programs like healthcare while the other is less inclined to do so.

    If the President want to lighten things up a little, I’ll give him the line.

  15. I suppose this is a little tricky, because in Warren Buffet’s case I believe he was talking flat out about the debt. His comfort with a higher tax rate probably was more about fiscal responsibility and less about a desire to shift our national resources along the “guns vs. butter” continuum. However, the more common context of an “I’d be happy to pay more taxes remark” is not about general fiscal responsibility but instead contingent on the idea that spending would focus more on doing good and less on growing the military-industrial complex. I suppose it wasn’t as completely misleading as my original take on it suggested, but it was still somewhat misleading, given that wealthy Americans willing to pay more taxes are not all of one mind about the context of that willingness.

    Still, about the broader point I remain unpersuaded. Yes, public education in the United States is flawed. However, it is madness to focus so much on those flaws as to believe the next generation would do better without access to public schools. Pushes toward privatization generally promise great wonders only to deliver unimpressive fizzles. Some homeschooling situations produce wonderful results, yet those are contingent on the availability and dedication of a parent zealous about the effort. In the end, public education does a great deal of good. To condemn it wholesale on its flaws is very much throwing out the baby with the bathwater.

    The same can be said of other social programs to greater or lesser degrees. I am not against every possible cut in these areas. However, I do think that millions of Americans have been misled by unscrupulous pundits, and equally unscrupulous politicians, George W. Bush among them, into the false belief that policies only slightly flawed are instead policies doomed to certain failures.

    The health care debate is a classic example. Again and again and again, people who are in fact gullible (as lack of gullibility would prevent them from being suckered into this belief) assert that the national health programs of Western European nations are unsustainable. Yet when we look at relevant factors like accumulation of federal debt, not a one of them is anywhere near as troubled as the United States. Our military procurement binges are sustainable, but clearly less so than their genuinely useful medical spending. After all, a VTOL stealth air superiority plane is only good for impressing military brass, but their healthier workforces are invaluable national assets.

    Perhaps most troublesome is this notion that “welfare does not help people out of the cycle of poverty.” That is flat out wrong on multiple counts. For one, many people would define welfare to include policies like unemployment insurance — a crucial measure that enables households to remain economically viable in spite of a common misfortune. It may be true that some children supported by government aid go on to bear children of their own while depending on government aid, but that is hardly the norm.

    If the paranoid hysteria about “welfare queens” and “anchor babies” was based in a mature informed worldview, then nations with much more generous social programs would be overrun with willful idleness. That they instead manage to sustain respectable economic growth is ample evidence that such programs are effective as a safety net for people afflicted with temporary problems and a harm reduction strategy for people with chronic problems (and keep in mind, not all unemployability is a scam — a wide range of medical and psychiatric conditions are barriers enough that expecting 100% of the afflicted to overcome them is ridiculous.)

    Okay, so part of the wealth of our nation can be attributed to genocide, slave labor, etc. However, much of our relative progress compared with other prosperous nations has to do with the way we used to be innovative in the establishment of social minima. Widespread availability of public education helped to define the United States in the 19th century. FDR’s New Deal brought the American middle class back from the brink of extinction. Even in the 60s and 70s, many bold initiatives made it possible for almost all American citizens to partake of the growth of our economy.

    For the past 30 years, virtually all of our economic growth has been concentrated in the top quintile of American incomes. I don’t believe proponents of trickle-down economics argued that it should take more than a full generation before something should actually trickle down to the general population. It isn’t that the other 80% of the nation stopped contributing to productive endeavors. Yet it is the case that an overwhelming majority has long been denied any meaningful reward for those contributions. It would be crazy to suggest that this should be addressed by purchasing a new Cadillac for every adult citizen of the U.S. On the other hand, joining the rest of the civilized world in providing basic medical services at little or no cost even to citizens who are not formally recognized as elderly or impoverished — to me it seems unreasonable to do any less at this point in history.

  16. Mr. Bush’s statement was a joke and I believe that put in context it means that if people think they can pay more in taxes for things they are more than welcome to.

    You seem to assume that that needs to then go into the government. (and yes Bush’s joke mentioned sending checks to the IRS)

    However, I suspect that if you had extra money you wanted to promise to deliver to a school system, a local government pothole fund, or even to a scientist studying solar energy or whatever your thoughts about infrastructure lead you that the checks would be welcomed and used appropriately.

    There is nothing stopping people from paying what they want to the programs they want to pay for. Taxes are coerced. You are bound to think these monies go to the good of all, when they are going where you believe they should be going, but others disagree.

    I suspect some guy at the Pentagon believes that tax dollars spent on potentially knocking out incoming missiles is a good idea too. But you disagree and you don’t want your tax dollars going there.

    See how this works?

    I too agree that public education is a good investment. I also believe a catastrophic healthcare insurance policy for the nation is a good idea. However, I don’t believe that I need to pay for little Jimmy who has a head cold to receive antibiotics from some bad doctor who is passing out antibiotics because parents want to do something active for their children.
    There is a difference.

    The big, big cycle of poverty mostly ended with welfare reform under Clinton and the Republican congress. I give them credit for that. And I think it’s an example of what can happen.
    (and yes I know actual anchor babies and I know legal workers who get cranky when their cousins come, have an anchor baby and are excited about the free goods given at the hospitals)

    I don’t put unemployment under the same category as welfare (though others would with equally valid views) but would also note that many, many countries with big social welfare programs are having big problems. The unemployed youth of France (20% unemployment among them) or the UK’s recent foray into discussing not treating the obese or smokers are just 2 examples.

    Much of what the rest of the world can and does afford is on the backs of the US military. You can argue where we should or shouldn’t be but I can pretty much bet that the western world wants us to continue with a certain degree of hegemony or they would have to step up and play a larger part in world affairs and their tax payers would have play a larger part in their own affairs to the detriment of their social programs that exist now.

Comments are closed.