Why Not Blame Obama? The media favorite has a very poor grasp of basic economic principles.

[Maribelle]

...Obama bungled his answers on tax policy big time. Period. End of sentence. End of story. To my liberal friends in the media, all I can say is: Get over it. Your guy has a very poor grasp of basic economic principles.



...This is more than just a failure to understand the Laffer curve. It’s another cultural misstep by Obama. I can’t help but wonder if the senator knows any cops or firemen. His appeal is to well-educated latte liberals. That remark about middle-income folks having turned to God, faith, and guns because of economic setbacks? Not only was it ill-advised, it illustrates the wide cultural chasm that exists between the candidate and the rest of America.


more...

http://article.nationalreview.com/?q=OTEwYWUxNjY0ZTJmNGY4NjAwYTM4NmJhNWMzZWYxNzc=#more

It appears Obama and his followers had better hurry and do some economics homework before this is used against them.

[anonymous171]

1. lol rw

[polpilot]

39. With all Obama's 'mistakes' he's still crushing Hillary. Crushing.

Imagine if he did something right.

[stray cat]

2. Educated individuals including those latte drinking workers in inner cities

[dkf]

3. Gosh and I thought Hillary wanted to raise taxes too?

Guess I must be wrong on that subject...she loves the Bush tax cuts after all.

[The Velveteen Ocelot]

4. The National Review...

Once again, an editorial from a right-wing publication is cited on DU as ammunition against a Democratic candidate. Larry Kudlow, ferchrissakes!

[dkf]

5. And from Larry Kudlow, who says our economy is the "greatest story never told".

Yeah, all you bitter Pennsylvanians...you are deluded. Everything is just great and you should be happy happy happy.

[hfojvt]

6. Huh? We need to do economics homework

before the National Review criticizes us? What the heck are they saying about the Laffer curve? Is Hillary and/or her supporters a believer in the Laffer curve now?

http://journals.democraticunderground.com/hfojvt/53

[democracy1st]

7. he's not raising taxes he's reversing Bush's tax cuts,you've been played

By rightwing framing

[question everything]

34. No, he wants to raise capital gain taxes

where many Americans, earning below $50,000 have reported this tax.

[PA Democrat]

53. Disingenuous. 92% of the benefits accrue to those making more than $200,000.

I posted a link below.

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=132x5579229#5580565

Edited to add link

[gmudem]

8. More rw garbage

Clinton supporters clearly trust the National Review and Richard Mellon Scaife more than they trust "democratic activists."

[Maribelle]

11. It's more like: don't put anything past the right wing thugs.

The devil you know ... , and all that jazz.

[gmudem]

60. What?

We all know what kind of crap right-wingers are going to spew. It just shouldn't be on DU.

[AX10]

9. Obama is the fluff candidate.

Hillary is the substance candidate.

[TheDonkey]

10. That is a complete distortion of what he was saying. Get real

If you want to criticize his position on raising the payroll tax limit that is legitimate but to say he was saying middle income people cling to guns because of economic issues is a flat-out LIE.

[JaneQPublic]

12. The National Review: Ronald Reagan's favorite magazine

Anyone posting from that rag should have to put a "WARNING" in the subject line, the same as when quoting from newsmax, etc.

So what we learn from this article is that Kudlow disagrees with Obama on economics but agrees with Jack Kemp. Big frigging surprise.

[dchill]

13. RW talking point - it's as if you're infiltrating DU...

with the theory that the "Laffer curve" is good right now, and that more tax cuts for the wealthy are the only way to improve it. Therefore, Obama has a "failure to understand the Laffer curve." Then we somehow get to some right-wing chaff like "cultural misstep," "well-educated latte liberals," "God, faith, and guns," and the ever-reactionary "wide cultural chasm that exists between the candidate and the rest of America." Oh, why doesn't the author just say, "He's black." Period. End of sentence. End of story.

Go away, Maribelle.

[chascarrillo]

14. National Review??? Fuck off.

[lyonn]

15. Interesting that Robert Reich is endorsing Obama

Interesting that he was born in Scranton, PA., teaches economics and was a member of the Clinton cabinet and now is backing Obama?? The Clintons are treating Obama like the repubs bashed Bill for not having experience. Bill was a pretty good pres., Hillary is another species. Bill showed respect for all, not so much Hillary. She bashes Obama for being an elitist? Who is the elitist? She cons the lower middle class and lower it appears with her compassion speeches that fail to show compassion. She is an angry lady. Gawd how she disappoints.

[question everything]

35. Yes, same Roebert Reich who praises the obscene companesations of CEOs

because the share values of their companies rise even while, and especially when they layoff thousands of employees.

[RichardRay]

16. Excuse me, the Laffer Curve? like, Arthur Laffer?

The patron saint of Supply Side Economics? The source of the foundations for the Bush tax cuts? The basis of the trickle down theory that has eviscerated real incomes? Reagan's favorite economist?

Laffer? That Laffer? Laffer's theories have a very small proven basis in some very special cases, but in general you have to go find a bastion of very wealthy people trying to get wealthier to find anyone who thinks the Laffer Curve makes much sense. The Cato Institute still defends it, but only under some very questionable assumptions.

If there's economics homework to be done here, it's not by Barack Obama.

[lyonn]

20. Laffer theory, are we talkin' trickle down again?

Reaganites love to confuse the masses with how well trickle down helped the people. Right, Reagan's bunch put millions of people out of their homes, businesses and let the lenders like banks, S&L's, mtg. co., off the hook by making the people pay for their outrageous losses. Silverado S&L is one great example, Poppy's younger son's gift to American business.

[RichardRay]

23. Yep, The Trickle Down Man himself.

I've not heard from the OP in the last little while. I think she's limping pretty badly from have shot herself squarely in both feet. I hope she remembered to take them out of her mouth before she fired, ohterwise it would be sort of messy.

[PA Democrat]

17. Why don't YOU explain the Laffer Curve for us? Or do you just take a right wing tool's word?

If there's one thing that economists agree on, it's that these claims are false. We're not talking just ivory-tower lefties. Virtually every economics Ph.D. who has worked in a prominent role in the Bush Administration acknowledges that the tax cuts enacted during the past six years have not paid for themselves--and were never intended to. Harvard professor Greg Mankiw, chairman of Bush's Council of Economic Advisers from 2003 to 2005, even devotes a section of his best-selling economics textbook to debunking the claim that tax cuts increase revenues.

The yawning chasm between Republican rhetoric on taxes and even informed conservative opinion is maddening to those of wonkish bent. Pointing it out has become an opinion-column staple. But none of these screeds seem to have altered the political debate. So rather than write yet another, I decided to find out what Arthur Laffer thought.

Laffer is a bona fide economist with a doctorate from Stanford. He's also largely responsible for the Republican belief that tax cuts pay for themselves. Now 67, Laffer runs economic-consulting and money-management firms in Nashville. About the best I could get out of him on the question of whether the Bush tax cuts have paid for themselves was "I don't know." But that's only part of the story.


http://www.time.com/time/magazine/article/0,9171,1692027,00.html

[lyonn]

28. Last comments in this article sounds like an oxymoron:

"But Reagan's tax cuts for the nonrich were big money losers, and it took the fiscal discipline of Bill Clinton to mop up the resulting red ink. Laffer gushes with praise for Clinton, but he's also a fan of Clinton's successor. "What Clinton did was, he gave Bush the fiscal flexibility to do what was right," Laffer says. In the face of the recession and terrorist attacks of 2001, Bush "needed to stimulate the economy and spend for defense, and Clinton gave him the ability to do that."

In other words, the Bush tax cuts were meant to create big deficits. But Laffer's O.K. with that. "The Laffer Curve should not be the reason you raise or lower taxes," he says. Perhaps not, but it does make for great campaign promises."

[PA Democrat]

31. I know, that was actually funny.

[Renaissance Man]

18. Economic Principles

If Senator Obama doesn't understand basic economic principles, then why have those same tax cuts not produced enough revenue to keep up with the degree of SPENDING that has been done by GWB?

You can argue that cutting capital gains taxes increases revenue until the cows come home. If that isn't accompanied by pay as you go, and a trade surplus (as opposed to a trade deficit), then it's done in vain.

[question everything]

36. No amount of tax revenue can meet the pay as you go

when our budget deficit is so high.

When a high percentage of our income taxes go to service the national debt.

[PA Democrat]

19. Another link refuting your right wing talking points.

<snip>

The recent analysis by Mr. Page at the Congressional Budget Office dismisses the idea that tax cuts may actually improve the government's fiscal situation. Even in his most generous scenario, only 28 percent of lost tax revenue is recouped over a 10-year period. The United States, it seems, is firmly planted on the left side of the Laffer Curve.

Recent experience corroborates this prediction. In the second quarter of 2001, just before the first of President Bush's tax cuts took effect, federal receipts from personal taxes accounted for 10.3 percent of the economy. By the end of the post-recession slump, receipts had dropped to 6.4 percent. But in the third quarter of 2005, with the economy booming, they were still under 7.5 percent - an enormous difference. In dollar terms, federal receipts from personal income taxes, at $802 billion in 2004, are still lower than they were in 1998 ($826 billion) and much lower than in 2001 ($994 billion).

http://www.nytimes.com/2006/01/01/business/yourmoney/01view.html?pagewanted=1&_r=1

[hfojvt]

21. Larry Kudlow is either ignorant or a liar or both

He writes:

"The Wall Street Journal’s Steve Moore points out that in 2005, almost half of all tax returns reporting capital gains came from households with incomes under $50,000, while more than three-quarters came from households earning less than $100,000."

except I find, using tax stats from the IRS here:
http://www.irs.gov/taxstats/indtaxstats/article/0,,id=129270,00.html

In 2005, there were 21,677,179 returns filling out schedule D for capital gains or dividends. Of that number 6,452,405 had income under $50,000. That's only 29.7% NOT "almost half". Of that number 13,859,448 had incomes under $100,000. That's 63.94% NOT "more than three-quarters".

Keep in mind too, that $50,000 is not actual personal or household income. It is "adjusted gross income". Secondly I note that there were 54,585,560 filers with income below $50,000 who had no capital gains or dividends. Thus, only 10.6% of filers with incomes below $50,000 had capital gains or dividend income.

The IRS also notes that the lower tax rate for dividends and capital gains saved taxpayers $91.65 billion in 2005. Of that amount 1.198 billion went to taxpayers making less than $50,000 (that's a whopping 1.3%!!!) and $4.84 billion went to taxpayers making less than $100,000 (that's a whopping 5.2%).

On the other side, the 11,433 filers with income of $10,000,000 or more saved $25.84 billion (28.1% of the benefits going to .05% of the beneficiaries) and the 101,676 filers with income over $2,000,000 got $46.615 billion (50.9% of the benefits going to .47% of the beneficiaries.)

It's pretty clear who the real beneficiaries are of the lower rates on dividends and capital gains and it's not the few people with incomes under $50,000 or $100,000 with capital gains that Kudlow and the Wall Street Journal are shedding crocodile tears for.

[geek tragedy]

22. you're either a Republican or an idiot. n/t

[virgdem]

24. I'd choose idiot

eom

[BlooInBloo]

25. Sad but funny watching Clinton supporters embrace republicans....

... No worries - rock on. We've learned our lesson about you.

[Willo]

26. I recall he impressed them in NY on economics, among other places

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=108x128053

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=132x5283223

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=132x5352267

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=132x5416097

http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=132&topic_id=4357582&mesg_id=4357582

[Maribelle]

27. Obama said he admired Reagan for putting us on a different trajectory.

And Kudlow, whom Obama followers are bashing above, was part of Reagan's administration, Reagan's supply-side economics that batter so many hard working Americans - - Reagan's trickle down that dried high.

[PA Democrat]

29. That's not what he said, and you know it, Obama NEVER said he supported Reagan's economic policies.

I am very familiar with the concept of the Laffer Curve having earned a degree in economics and having worked in the financial services industry for years.

I posted several links above which explain in layman's terms the fallacy of your OP.


But keep digging if you so choose.

[Maribelle]

37. Actually, my op was suggesting that Obama's followers do their homework on this.

Your links will help them do just that. Building a strong foundation for the battle against the republican thugs should Obama receive the nomination will help.

[PA Democrat]

54. Yeah, right.....

:eyes:

[RichardRay]

30. Maribelle: May I suggest that you give up on this one?

You got it wrong. You quoted material you didn't understand. If you want to advocate effectively for your candidate of choice I suggest you be more careful in the future. It's too late on this one, though.

Basing anything in economics on the work of Arthur Laffer only takes you one place, and it's not where you, me, Senator Clinton and, certainly, not where Senator Obama wants to go.


(edit for spelling)

[Maribelle]

38. You're making false assumptions then trying to bash me with them.

Long before this latest debate Obama said 'I don't want to present myself as some sort of singular figure. I think part of what's different are the times...I think Ronald Reagan changed the trajectory of America in a way that Richard Nixon did not and in a way that Bill Clinton did not. He put us on a fundamentally different path because the country was ready for it. I think they felt like with all the excesses of the 1960s and 1970s and government had grown and grown but there wasn't much sense of accountability in terms of how it was operating. I think people, he just tapped into what people were already feeling, which was we want clarity we want optimism, we want a return to that sense of dynamism and entrepreneurship that had been missing.

[RichardRay]

59. No, Maribelle, I'm not doing that...

In your original post you stated that Barack Obama is not qualified to be President as he has a deficient understanding of economics. The post is a long way back up there, so I'll quote it to you here:

Why Not Blame Obama? The media favorite has a very poor grasp of basic economic principles.

...Obama bungled his answers on tax policy big time. Period. End of sentence. End of story. To my liberal friends in the media, all I can say is: Get over it. Your guy has a very poor grasp of basic economic principles.

That's what you titled the post, and the quote you chose to lead with.

In support of that you quoted more of the article and chose from it a reference to the Laffer Curve. You made no reference to Regan, supply side economic theory nor the Bush tax cuts. You simply quoted the author of the article as an authority. The specific reference was to the Laffer Curve and Senator Obama's lack of understanding of it. You gave no hint that you understand what Laffer was claiming with his infamous 'curve', nor have you done so since. Regan and subsequent supporters of the idea have claimed that entrepenueurship is driven by policies suggested by Laffer's laughable ideas, but there is no actual evidence of that. If you have some please trot it out, I haven't been keeping up on the literature in that area for the last couple of years, I'd pretty much assigned the whole chimera to the trash heap along with the phogiston theory and racial eugenics.

The article from which you quoted was from the National Review Online, the web home for the National Review. Here's the National Review's description of itself, taken from their media kit:

National Review and NRO are America's most widely read and influential magazine and web site for Republican/conservative news, commentary, and opinion. Both magazine and web site are the benchmark vehicles for reaching those Republicans/conservatives who shape opinion on the important issues, and both reach an affluent, educated, and highly responsive audience of corporate and government leaders, the financial elite, educators, journalists, community and association leaders, as well as engaged activists all across America.

emphasis mine

NRO Media Kit

The article was written by Larry Kudlow,

Lawrence (Larry) Kudlow (born August 20, 1947), is an American conservative, supply-side economics enthusiast and television personality. ... He opposes estate taxes, as well as taxes on dividends and capital gains. Kudlow advocates that employees be compelled to make greater contributions to their pension and medical costs, suggesting that these expenses are an undue burden on corporations. Kudlow defends high executive compensation as a manifestation of market forces and opposes most forms of government regulation. He believes that reducing taxes will increase governmental revenue through expansion of the overall economy. ... He advocates wide ownership of stocks and frequently speaks of a broad "investor class" that includes most Americans.

Lawrence Kudlow Wikipedia entry current as of April 17, 2008

At no point do you attempt to link Senator Obama's economic ideas with those of Ronald Regan, you simply state baldly that he has an inadequate grasp of economics, and you do so based on his failure to follow a discredited economic theory advocated for by someone who thinks workers should pay more for healthcare.

When other posters have suggested that you didn't know what you were doing when you raised the issue you've attempted to deflect the consequences of your error by trying to conflate Senator Obama's economic ideas with Ronald Regan's, something for which there is absolutely NO spport.

You threw yourself under this particular bus, now deal with it.

[stillcool]

32. I think you have a credibility problem...

I predict your next post will be about Reverend Wright, Rezko, Ayers or Bitter-gate. Or you could reach way back and go with one of these...

December 10, 2007
Third Clinton Volunteer Knew Of Smear E-Mail
A third volunteer for Hillary Clinton's campaign was aware of a propaganda e-mail alleging that Barack Obama is a Muslim who plans on "destroying the U.S. from the inside out."
"Let us all remain alert concerning Obama's expected presidential Candidacy," the email reads. "Please forward to everyone you know. The Muslims have said they Plan on destroying the U.S. from the inside out, what better way to start than at The highest level."


Two Clinton volunteers, Linda Olson and Judy Rose, have already been asked to resign from the campaign for their roles in forwarding the e-mail. The AP reported yesterday that Olson, a volunteer coordinator in Iowa County, sent a version of the e-mail to 11 people, including Ben Young, a regional field director for Chris Dodd's campaign. Young passed it on to the AP.
http://hotlineblog.nationaljournal.com/archives/2007/12/third_clinton_v.html

Kerrey Apologizes to Obama Over Remark
http://abcnews.go.com/Politics/wireStory?id=4031436
Kerrey's mention of Obama's middle name and his Muslim roots raised eyebrows because they are also used as part of a smear campaign on the Internet that falsely suggests Obama is a Muslim who wants to bring jihad to the United States. Obama is a Christian.

The Clinton campaign has already fired two volunteer county coordinators in Iowa for forwarding hoax e-mails with the debunked claim. Last week, a national Clinton campaign co-chairman resigned for raising questions about whether Obama's teenage drug use could be used against him, so Kerrey's comments raised questions about whether the Clinton campaign might be using another high-profile surrogate to smear Obama.

I have even seen this one recycled...

[Maribelle]

41. That, or my post is 35,000 feet over the heads of those that merely

want to bash Hillary supporters at all costs.

[stillcool]

43. I don't believe it's Hillary "supporters"

that are being bashed..unless they continue to participate in smear tactics, just for the hell of it. It is obvious that these are bogus, that they haven't worked no matter how often they're floated, and the only thing they manage to do is provoke rancor. BTW, from your perch 35,000 feet above the rest of us, you are not nearly as superior as you think you are.

[Willo]

42. I've supplied five links to information each leading to more details

take a little more time

[question everything]

33. Right. He pledged not to raise taxes on Middle Income Americans

whom he describes as people with annual income lower than between $200,000 and $250,000.

Yet, he wants to raise Capital Gain taxes. In 2005, 47% of all tax returns reporting capital gains were from households with incomes below $50,000, and 79% came from households with incomes below $100,000.

And, he never responded to Gibson's insistence that history showed that lowering capital gain taxes increased the total revenue from this tax.

[Maribelle]

40. Yes - - and Obama would need to reconcile this glaring discrepancy ...

if he were to receive the nomination.

Right wing thugs are gearing up for the battle.

[Warren DeMontague]

46. Apparently.

Ye shall know them by their works- as well as their tactics and source material, I would wager.

[PA Democrat]

48. See my post below for actual statistics rather then right wing spin.

[PA Democrat]

47. Cuts to the capital gains tax disproportionately benefit the wealthy

The benefits of low tax rates on capital gains accrue disproportionately to the wealthy. In 2007 an estimated 92 percent of the benefit of low rates went to taxpayers with incomes over $200,000, and 72 percent to those earning over $1 million.

http://www.taxpolicycenter.org/briefing-book/key-elements/capital-gains/lower-rate.cfm

Also, there is still quite a bit of debate about the long term effects in a cut to capital gains tax rate. There is an immediate upswing in revenues as people sell assets to take advantage of the lower rates, and then total revenues drop off dramatically.

Regardless, the current system of taxation in grossly inequitable and broken as is evidenced by the way the system is gamed by investment funds managers to avoid paying income taxes.

http://www.washingtonpost.com/wp-dyn/content/article/2007/07/29/AR2007072900863.html

[Emit]

44. Larry Kudlow?

National Review on line?

Are you nuts?

[Maribelle]

51. Obama said ...

'I don't want to present myself as some sort of singular figure. I think part of what's different are the times...I think Ronald Reagan changed the trajectory of America in a way that Richard Nixon did not and in a way that Bill Clinton did not. He put us on a fundamentally different path because the country was ready for it. I think they felt like with all the excesses of the 1960s and 1970s and government had grown and grown but there wasn't much sense of accountability in terms of how it was operating. I think people, he just tapped into what people were already feeling, which was we want clarity we want optimism, we want a return to that sense of dynamism and entrepreneurship that had been missing.


Perhaps some of you do not understand that entrepreneurship was directly related to Reagan's supply-side economics, and Kudlow was part of Regan's economic administration.

This issue needs to be resovled.

[PA Democrat]

52. So let's use some logic here....

If Obama APPROVED of Reagan's economic policies, why is his economic plan so different from Reagan's?

Obama was talking about how Reagan was able to get the country to support his ideas because of a perception of lack of accountability by the government in the way tax dollars were being spent. Obama sees that many Americans once again feel that their government is not working for them

The difference is in how Reagan deceptively used the American people's distrust of government to push through some very radical economic policies. Remember that his supply side economic policies were a travesty in that they tripled the national debt during Reagan's presidency.

[Maribelle]

55. I truly believe there is a logical disconnect between what you say Obama meant-and-what he said.

And in my opinion the key to the disconnect is embedded in the sense of ... entrepreneurship - - - because the entrepreneurship was directly related to Reagan's trickle down economics. What else could have been within that path curve or process which Reagan changed?

tra·jec·to·ry {trə jéktəree} (plural tra·jec·to·ries) n

1. path of flying object: the path that a projectile makes through space under the action of given forces such as thrust, wind, and gravity
2. curve intersecting at constant angle: a curve or surface that intersects all of a family of curves or surfaces at a constant angle
3. path of process or event: the way in which a process or event develops over a period of time

repeating what Obama said:
'I don't want to present myself as some sort of singular figure. I think part of what's different are the times...I think Ronald Reagan changed the trajectory of America in a way that Richard Nixon did not and in a way that Bill Clinton did not. He put us on a fundamentally different path because the country was ready for it. I think they felt like with all the excesses of the 1960s and 1970s and government had grown and grown but there wasn't much sense of accountability in terms of how it was operating. I think people, he just tapped into what people were already feeling, which was we want clarity we want optimism, we want a return to that sense of dynamism and entrepreneurship that had been missing.

[PA Democrat]

58. News flash: Rejection of supply side economics and a belief in entrepreneurship

are NOT mutually exclusive. You are being silly.

[Warren DeMontague]

45. You're quoting the national review?

Good fucking grief.

:rofl:

[PA Democrat]

50. Kudlow, no less. Kudlow, an economic adviser to Ronald Reagan.

And we all know what a screaming success Reagan's tax policies were in terms of reducing the national debt. :crazy:

[dkf]

56. Yeah, trickle down economics that are the foundation of Bushonomics.

Sigh...apparently our OP is the one who doesn't have a clue.

[Starbucks Anarchist]

49. Post something other than a RW mag like National Review, then we can talk.

[dkf]

57. Atrios catches Larry Kudlow in a mistake! hahaha.

Larry Kudlow:


Uncapping the payroll tax reveals still another cultural misstep by Sen. Obama. He apparently has a difficult time understanding that nowadays, a veteran fireman or a veteran cop, married to a veteran schoolteacher, will make well over $100,000. In fact, they can make close to $200,000. Yet Obama still wants to go ahead and tax both the first and last payroll dollar of this group at a very high marginal tax rate by uncapping the Social Security (FICA) tax.



The FICA cap is an individual cap, unaffected by income earned/payroll taxes paid by your spouse.

(ht reader js)

http://www.eschatonblog.com/