[besson3c]

I'm starting to wonder if all of this consternation about tax cuts and domestic policy is really pointless since the next major free market war is going to be waged abroad in countries such as China and India...

I mean, for the most part our winners and losers have been picked here, certain companies have strong control over virtually all of the major markets. However, with these Chinese countries urbanizing and new cities just sprouting up, these same companies must be really licking their chops. New markets are the name of the game in the development of any company, your cash cows and existing markets can only sustain you for so long. If I were wealthy corporation X, why would I be fussing over trying to fight over a small piece of the pie in an American market when there is so much potential elsewhere?

Therefore, the way I see it, these tax cuts will just largely make it easier for these companies to pursue these endeavors, but I'm wondering how much of this Americans will benefit from regardless of what our tax rates are? Yes, increasing business does have the potential to create more American jobs, but wouldn't it make more sense to expand abroad if you are focused on reaching non-American markets?

Take a look at Apple. We are all aware of their crazy wealth and success. I don't know if this story is accurate, but it was the first thing that came up in a Google search for "international iPhone sales":

AppleInsider | International sales expected to account for 80% of iPhones sold in 2010

If this is close to being true, companies like Apple are growing the way they are not because of sales here in America, but because of their international markets.

I'm a little obsessive and naive about international economic growth, I admit, but then again, I'm surely not the only one since many of us are obsessed over whether tax cuts to the rich will result in a trickle down, etc. If I'm barking up the right tree, whatever trickle down will occur is probably small potatoes, the real wealth is going to be gained from other markets.

[Athens]

the Global market is a big force. Ford was profitable 3 years in a row now (or 2 cant remember) because of unexpected higher sale numbers in China. But China and India will hit resource limits that prevent the entire populations from ever becoming affluent enough to be consumers. I can't remember which documentary it was that I watched but it was in the numbers of 300 Million from each country before resources to sustain numbers higher then that would peek. China is already running into Water shortages from Industry and Cattle industries now. Meat turned into a big indicator of wealth and ability to provide wealth. As more Chinese for example consume more meat, a indication of the wealth of the family, the water demands on the country rise to provide such meat. Average well off Chinese family still consumes a 4th of the meat we consume.

The next wars will be over water not economics. The emerging markets which are currently ripe for selling and exploiting our capitalistic economies to will be limited to further future growth and internal turmoil halting and possible reverting the trend. Make your money in the stock markets now

[ghporter]

National level tax policy is relevant to domestic markets, which drive activity with international markets. When people have more disposable income, they spend more (eventually, at least in theory, they will). This means domestic tax policy should drive both consumer level market forces and higher level forces-many corporations have been holding off on things like hiring and upgrading their equipment simply because of uncertainty about tax policy.

These "tax cuts" were implemented over 10 years ago-they're effectively the status quo. The bill just enacted merely maintains tax rates Americans have been accustomed to for a decade. No new income tax rate changes were included here. What the Bush administration managed to do with these cuts is place future administrations in the situation of having to avoid raising tax rates by continuing these rates-as was just done.

[mduell]

Originally Posted by Athens 

the Global market is a big force. Ford was profitable 3 years in a row now (or 2 cant remember) because of unexpected higher sale numbers in China.

And a secret $26B from the Fed.

[besson3c]

Originally Posted by ghporter 

National level tax policy is relevant to domestic markets, which drive activity with international markets. When people have more disposable income, they spend more (eventually, at least in theory, they will). This means domestic tax policy should drive both consumer level market forces and higher level forces-many corporations have been holding off on things like hiring and upgrading their equipment simply because of uncertainty about tax policy.

These "tax cuts" were implemented over 10 years ago-they're effectively the status quo. The bill just enacted merely maintains tax rates Americans have been accustomed to for a decade. No new income tax rate changes were included here. What the Bush administration managed to do with these cuts is place future administrations in the situation of having to avoid raising tax rates by continuing these rates-as was just done.

I'm talking about the tax cuts for the rich.

[Athens]

Originally Posted by mduell 

And a secret $26B from the Fed.

Link? This is the first I have herd about any secret money from the Fed's

[Uncle Skeleton]

Originally Posted by besson3c 

I'm starting to wonder if all of this consternation about tax cuts and domestic policy is really pointless since the next major free market war is going to be waged abroad in countries such as China and India...

I mean, for the most part our winners and losers have been picked here, certain companies have strong control over virtually all of the major markets. However, with these Chinese countries urbanizing and new cities just sprouting up, these same companies must be really licking their chops. New markets are the name of the game in the development of any company, your cash cows and existing markets can only sustain you for so long. If I were wealthy corporation X, why would I be fussing over trying to fight over a small piece of the pie in an American market when there is so much potential elsewhere?

Tax cuts aren't about selling product, they're about producing product. Globalization hurts us on the production end, not the sales end (it helps us on the sales end, because we get to buy cheaper goods). Increasing globalization would only argue that sales are increasingly irrelevant, and if you want producers on your soil you have to incentivize it (or rather stop punishing it), regardless of where in the world they send their product after it's produced.

Yes, increasing business does have the potential to create more American jobs, but wouldn't it make more sense to expand abroad if you are focused on reaching non-American markets?

It certainly would if there are punitive taxes on success here, or so the argument goes.

If you believe that production staying in the US is a lost cause, then by the same token so is tax collection. In that case you would just be trying to cash out the economy before it goes tits up, so what is the point?

Take a look at Apple. We are all aware of their crazy wealth and success. I don't know if this story is accurate, but it was the first thing that came up in a Google search for "international iPhone sales":

Sales are irrelevant. What's relevant is jobs. Where the product is produced, not where it is sold.

[besson3c]

Originally Posted by Uncle Skeleton 

Tax cuts aren't about selling product, they're about producing product. Globalization hurts us on the production end, not the sales end (it helps us on the sales end, because we get to buy cheaper goods). Increasing globalization would only argue that sales are increasingly irrelevant, and if you want producers on your soil you have to incentivize it (or rather stop punishing it), regardless of where in the world they send their product after it's produced.

On the producing end? What do we produce anymore? That is also all done abroad, for the most part, so this too would not translate into jobs, no?

It certainly would if there are punitive taxes on success here, or so the argument goes.

If you believe that production staying in the US is a lost cause, then by the same token so is tax collection. In that case you would just be trying to cash out the economy before it goes tits up, so what is the point?

I'm not saying that our economy is in dire straights based on what I've written. I'm saying that there may be no amount of tax cuts to the wealthy that will make a difference in terms of creating new jobs.

[Uncle Skeleton]

Originally Posted by besson3c 

On the producing end? What do we produce anymore? That is also all done abroad, for the most part, so this too would not translate into jobs, no?



I'm not saying that our economy is in dire straights based on what I've written. I'm saying that there may be no amount of tax cuts to the wealthy that will make a difference in terms of creating new jobs.

But production is still the goal. You're saying it's not worth trying, they are saying try anyway. Here is a test for you: When the going gets tough, the tough (A) get going? or (B) give up?

Even if I am skeptical that their optimism is appropriate, it still seems to be the only option. Again, if you throw in the towel on producing anything, ever, what hope is there? IMO we simply have no choice but to continue to try to produce something, in the big picture, or all is lost. It doesn't have to be the same things we've produced historically, but it does have to be something. And neither will happen if you decide that your policy is to give up altogether on trying to be attractive to producers.

[besson3c]

That's a false question, I would say the actual question is do you: A) ignore reality, or B) confront it

The reality is that American employers are not going to relocate their Chinese sweatshops back to America.

[Uncle Skeleton]

Originally Posted by besson3c 

That's a false question, I would say the actual question is do you: A) ignore reality, or B) confront it

The reality is that American employers are not going to relocate their Chinese sweatshops back to America.

But new employers might choose not to start sweat shops in China.

How can we survive without producing anything? Is your reality that we will simply be sponges until we run out of savings, then die? Why bother collecting taxes if that is true? If bankruptcy is inevitable, you don't pay your debts, you max them out and spend it.

[besson3c]

There are jobs that need to be here and *some* opportunity here, but I'm saying that the big piece of pie left for big businesses to dominate is not here, and these big business owners are going to be the greatest benefactors for the tax cuts to the rich.

Then again, I'm not sure I understand your thought process here...

[SpaceMonkey]

Originally Posted by ghporter 

These "tax cuts" were implemented over 10 years ago-they're effectively the status quo. The bill just enacted merely maintains tax rates Americans have been accustomed to for a decade. No new income tax rate changes were included here. What the Bush administration managed to do with these cuts is place future administrations in the situation of having to avoid raising tax rates by continuing these rates-as was just done.

One nitpick about this. The entire point behind these tax cuts having an expiration date is that their original rationale was as a temporary stimulus (we had a little recession back then, too) and there were objections raised that they would be fiscally irresponsible over the long term. Certainly the Bush Administration was savvy enough to recognize that it would be politically very difficult to eliminate these tax cuts once they had been in effect for long enough, but the Republicans' talking point during the debate about this being "existing tax policy" was fundamentally dishonest.

[Laminar]

Originally Posted by Athens 

Link? This is the first I have herd about any secret money from the Fed's

Details here

[Uncle Skeleton]

Originally Posted by besson3c 

There are jobs that need to be here and *some* opportunity here, but I'm saying that the big piece of pie left for big businesses to dominate is not here, and these big business owners are going to be the greatest benefactors for the tax cuts to the rich.

Then again, I'm not sure I understand your thought process here...

I certainly don't understand yours. So let's make it simple. Please point out where you disagree.

1. goods/products will flow into the US. Correct?
2. in order to be sustainable, (1) must be balanced by goods/products flowing out of the US as well. Otherwise eventually we will simply be bankrupt.
3. (1) makes the US poorer overall (we spend money to get those things), and (2) makes the US richer overall (we sell those things to get money to spend on (1)).
4. you are complaining about (2) happening

[ghporter]

Originally Posted by SpaceMonkey 

One nitpick about this. The entire point behind these tax cuts having an expiration date is that their original rationale was as a temporary stimulus (we had a little recession back then, too) and there were objections raised that they would be fiscally irresponsible over the long term. Certainly the Bush Administration was savvy enough to recognize that it would be politically very difficult to eliminate these tax cuts once they had been in effect for long enough, but the Republicans' talking point during the debate about this being "existing tax policy" was fundamentally dishonest.

Certainly it was supposed to put some future administration in a bad place. But the Republican party also stood behind the original point in this recent deal, and forced their friends across the aisle to cave because it would put the "tax hike" on them. Dishonest? They're politicians...

And if the Dems had come up with a plan that would have gotten them their intended rate hikes on estates, they would still have come off soiled by the whole thing. The "death tax" is supposed to be an excellent example of how our tax structure is "progressive," but instead of introducing a reasonable tax on smaller estates, they howled at how 35% was too low for estates over 5 million. ?!!!??? Why not "progress" the structure downward and tax estates under $1 million at 5%? Because they'd all be out on the street come next election, that's why-estate values are higher today than ever before, and not just for really rich folks, so the middle class would take up torches and pitchforks if their beloved congresscritters actually taxed their estates "progressively" by applying a smooth, equitable formula. That's dishonest too, but again, they're all politicians.

[Dork.]

Originally Posted by Laminar 

Details here

That was hardly a secret.