May 8, 2013

"Federal tax revenue is up and spending is down..."

"... thanks to an improving economy, tax increases that took effect in January and the automatic budget cuts known as the sequester."

65 comments:

MadisonMan said...

And yet there's a deficit.

Interesting slant to the article from the WaPo.

tiger said...

WaPo acts like increasing taxes and mandatory spending cuts have some how fixed the economy.

Utter nonsense.

What ever savings are found will be spent.

The government can not control its abuse of the budgeting process nor it find a way to reduce its spending.

bagoh20 said...

Great, now we can spend it!

I could have spent my tax increase myself, and if required I could even do it frivolously like the government. Just give me a chance. I can do this job.

Mitchell the Bat said...

Prosperity is just around the corner!

Jay said...

By which measure or measures is the US economy "improving"?

The number of people on SS disability is at an all time high.

The number of people on food stamps is at an all time high.

The labor force participation rate is the same as 1979. Yes, there are fewer people working today than at the height of the early 1980's recession.

"Improving" is Orwellian.

Colonel Angus said...

If the rich would pay just a little bit more we can get the deficit down to 3/4 of a trillion dollars.

cubanbob said...

Raising rates, phasing out deductions, imposing new taxes will increase revenue independent of a stagnant economy. The WaPo could have asked its CPA's that. But that way too out of the box thinking for them. Now lets sequester 40% of the federal spending and the budget will be balanced.

RecChief said...

This looks like a Fox Butterfield moment from James Taranto

ricpic said...

Nicking away at that $16 trillion debt, a nickel at a time.

bagoh20 said...

Just think about the extra 2% taken from every single paycheck earned in your neighborhood, the extra hundreds taken from everyone in income tax, the thousands taken from "the rich" who may be there. That money all left your neighborhood, your stores, your businesses, your family, and your friends' families, and now it's in D.C. in the checking account of the U.S. Congress. And this week you will all send more, and again next week. Man, if that don't make you feel good, smart, and lucky, nothing can.

lemondog said...

The cut in the increased rate of spending ='budget cuts'.....

Jeff Teal said...

Strangely enough the revenue for our business just tanked in April.Causation,no; correlation,high.Thank you DC.

Robert Cook said...

The primary problem with out economy is not the deficit, but the lack of employment, and the shitty pay for the jobs that are available.

They could bring the deficit to "0" but if the employment situation remains dire, the American people are still fucked.

AprilApple said...

Amazing. Everything is peachy until Oct 1st, when the debt ceiling will need to be raised again.

All those trillions in deficits are gone!

Marshal said...

I skimmed to find proof "spending is down", and the only link is to another WAPO summary which included this laugher:

What’s more, the deep spending cuts known as sequestration mean that domestic and defense spending is starting to fall swiftly.

That's right, apparently 2% is "Deep".

Given the lack of sourcing I strongly suspect the "lower" spending is in comparison to spending without sequestration rather than spending last quarter or last year. In other words, taxes are up and spending is up, and WAPO's goal is laying the groundwork to increase spending even further.

Methadras said...

What a lie. The sequester was a cut to an already increased rate of spending. OH NOES!!! The sequester was horrible. Uh, no it's not. It's all artificially induced executive branch pain to fake like some kind of deep to the bone cut was made. Fucking fakers.

AprilApple said...

If Obama insists on even greater and higher tax hikes on the wealthy, why did Obama opt to only pay 18.4% when his bracket is the 39.6%?

bpm4532 said...

Don't be fooled. Just look at the increased levels of the Federal Reserve buying up Treasury bonds.

Of course, we'd be better with less spending, less regulation, and no Obamacare. Basically all the things Obama has done since he arrived. It was the expectation of his coming damage that triggered the great liquidity crisis in 2008.

edutcher said...

What Jay said. Workforce participation is the worst since the 70s.

And the ONLY reason spending is down is because of the sequester which, once the Demos found they'd have to live by it, they fought tooth and nail.

Colonel Angus said...

Unskilled work tends to pay shitty.

bagoh20 said...

Funny how the press doesn't identify the real 2% pay cut to every poor wage earner as a "deep cut" to their budgets.

mccullough said...

In other words, so far the Republicans were wrong about the effect of tax increases and the Democrats were wrong about the effect of controlling spending.

Colonel Angus said...

In other words, so far the Republicans were wrong about the effect of tax increases and the Democrats were wrong about the effect of controlling spending.

By and large, yes. My hiring practices are based upon the level of demand on my workforce, not how high my taxes are. The taxes I pay are factored into costs which are passed to the consumer. So even if my taxes are 45%, but I need more labor to fill demand, I hire more labor.Higher taxes have a bigger effect on my personal consumption.

Freder Frederson said...

If Obama insists on even greater and higher tax hikes on the wealthy, why did Obama opt to only pay 18.4% when his bracket is the 39.6%?

You don't know how a progressive income tax works, do you?

Jay said...

eder Frederson said...


You don't know how a progressive income tax works, do you?


You don't understand that claiming deductions is voluntary, do you?

CEO-MMP said...

Freder Frederson said...

If Obama insists on even greater and higher tax hikes on the wealthy, why did Obama opt to only pay 18.4% when his bracket is the 39.6%?

You don't know how a progressive income tax works, do you?"


Do you? C'mon, prove you do. Dazzle us. Or at least me. I dare you to dazzle me. I beseech you to dazzle me with your brilliant insights here.

Jay said...

Obama: "The rich aren't paying their fair share"

Obama's Accountant: "Hey Barry, I'm going to maximize your deductions for you"

Obama: "Sounds good to me!"

Freeper: "You don't know how a progressive income tax works, do you?

Comedy gold.

Scott M said...

and the shitty pay for the jobs that are available.

I have customers with sheet metal machinist jobs (entry level) that pay $40k, but he can't find anyone to do it.

There are plenty of jobs that pay well out there. What there aren't are a flood of people wanting blue collar work.

Mike said...

But wait, big-eared black jesus told me that austerity would cripple our economy! Damn. Lied to again.

cubanbob said...

Robert Cook said...
The primary problem with out economy is not the deficit, but the lack of employment, and the shitty pay for the jobs that are available.

They could bring the deficit to "0" but if the employment situation remains dire, the American people are still fucked.

5/8/13, 10:58 AM

Todays deficits are tomorrow's taxes. So even if what you said were true (it isn't) it still would worth cutting spending to balance the budget.

X said...

Jay, calling Freder Freeper just doesn't fit. have you considered Frederp?

cubanbob said...

By and large, yes. My hiring practices are based upon the level of demand on my workforce, not how high my taxes are. The taxes I pay are factored into costs which are passed to the consumer. So even if my taxes are 45%, but I need more labor to fill demand, I hire more labor.Higher taxes have a bigger effect on my personal consumption.

5/8/13, 11:26 AM

Lucky you! I wish in my business I had little or no competition so I can just pass on price increases.
As for taxes, well I don't know about you but I try to borrow the least I can from the bank and self-finance as much as possible. All else the same having higher retained earnings resulting from lower taxes helps to self-finance.

Jay said...

have you considered Frederp?

Sounds good to me!

Colonel Angus said...

Lucky you! I wish in my business I had little or no competition so I can just pass on price increases.

Um, I have competitors who also pay taxes which ill assume they are passing on to their consumers too.

Fortunately I'm able to self finance too although I maintain a line of credit as well.

Again, high taxes don't drive whether or not I hire. If my tax rate was 5% but I only need X number of workers to meet my demand, I'm not going to increase my labor force simply because my tax rate is low.

As I said, higher taxes will impact my consumption, not hiring.

Richard Dolan said...

It's the WaPo, the newspaper that put the Benghazi story in the style section yesterday. So what do you expect?

The notion that the budget crisis is not over because this year's borrowing by the Gov't will be about $750B rather than $1.1T is silly. Despite the increased tax revenues, that nunber will climb as the cost of O-care starts to hit. And in all events a deficit of $750B is staggeringly huge, even if it is lower than the even more staggeringly huge deficits of O's first four years.

Even sillier is the notion that the necessity of raising the debt ceiling being pushed back into the October-November time frame mgically derails the Republicans' poltical argument focusing on this issue. The sharp-eyed WaPo spinner seems to overlook the fact that the more this issue is in the spotlight in the run-up to the midterms, the worse it will be for Obama and the Dems. There are lots of voters for whom run-away debt, coupled with a weakly recovering jobs market, will overshadow everything else (including the problems that O-care will be causing at the same time).

Icepick said...

There are plenty of jobs that pay well out there.

Are there twelve million such jobs out there? Or are you relying on the single data point of your friend's business?

Because we're about 12 million jobs short of where we would be if we'd had a normal recovery.

Colonel Angus said...

Because we're about 12 million jobs short of where we would be if we'd had a normal recovery.

Good thing Obama wants that fast track to citizenship for the 12 million illegals already here. Nothing says high wages than millions of unskilled workers entering the workforce.

Larry J said...

Washington DC is a one company town and that company is the federal government. Like one company towns everywhere, there's a local paper that shills for the company. So, tax revenues are up due to the end of the payroll tax reductions. While that's bad news for everyone else, it's good for the company so the company rag thinks it's a good thing. Spending less than they planned to spend (but still far more than they have) is somehow a "spending cut" in the fantasy land of big government. Whores, one and all.

cubanbob said...

Colonel Angus said...
Lucky you! I wish in my business I had little or no competition so I can just pass on price increases.

Um, I have competitors who also pay taxes which ill assume they are passing on to their consumers too.

Fortunately I'm able to self finance too although I maintain a line of credit as well.

Again, high taxes don't drive whether or not I hire. If my tax rate was 5% but I only need X number of workers to meet my demand, I'm not going to increase my labor force simply because my tax rate is low.

As I said, higher taxes will impact my consumption, not hiring.

5/8/13, 12:09 PM

Different folks, different industries, different competition. In my business, exports are nearly half of my business and US taxes increase my costs and make it difficult to compete against foreign competition.

As for consumption, your reduced consumption all else being the same is someone else's reduction in sales and hiring and investment as well as your reduction in investment either in your own business or some other business.

As for me, happiness is having a balance sheet and retained earnings to be able to tell the bank FU. When you can do that they want to lend to you. It's when you can't that you have problems with the bank.

Since margins do count, and the competition in my neck of the woods is very fierce the only way to expand sales in a economy that is squeezing my margins is to cut costs and that means hiring overseas since the net after US tax makes a big difference to me. I'm not in business for my health.

n.n said...
This comment has been removed by the author.
Methadras said...

X said...

Jay, calling Freder Freeper just doesn't fit. have you considered Frederp?


Yeah, derp is about right. HAHAHAHAHA!!!

n.n said...

Both progressive and regressive taxation is discriminatory. Both will by their nature sponsor corruption.

As for "progress", it is an ambiguous concept. It only means monotonic change, which can be either negative or positive. I don't think that anyone would consider a progressive devaluation of capital, labor, and human life to represent positive progress.

The current state of progress is that our economy has experienced an increase of productivity at a rate of around 2% per annum. At the same time, both capital and labor have been devalued at a rate of around 8% per annum (i.e. Federal deficit). The progress we have experienced is negative and cumulative. Over the last 5 years, the real value of capital and labor has declined by around 30%. Fortunately, this loss has been socialized through many nations, and its effects have been further obfuscated through removal of capital from the private economy.

I don't think most Americans comprehend the function of a redistributive change economic model. It is designed to consolidate capital and control in the hands a of select minority (e.g. communist party) and its cronies in the general population.

Astro said...

bagoh20 said... Great, now we can spend it!
I could have spent my tax increase myself, and if required I could even do it frivolously like the government. Just give me a chance. I can do this job.


Such hubris.
NOBODY can waste money the way the federal government wastes money.

bwebster said...

Don't forget that a big bulge of increased tax revenues was also due to wealthy individuals realizing income in November and December ahead of the tax hikes (e.g., George Lucas selling Lucasfilm to Disney, Al Gore selling Current TV to Al Jazeera, etc.).

Saint Croix said...

Nicking away at that $16 trillion debt, a nickel at a time.

That is not even close to true.

The debt is now projected to be $16.8 trillion by October.

So figure $17 trillion by December.

In other words, instead of the $1.5 trillion deficits we've been running, we get a standing ovation from the WaPo for the $1 trillion deficit we're running this year.

Awesome.

tim in vermont said...

Brewster's Millions
Obama's Trillions

Same Shit, different day.

Saint Croix said...

According to the government, our debt is $16.78 trillion right now

Debt increased almost $6 trillion during the first Obama administration.

Debt has gone up $400 billion in the first four months of this year.

Saint Croix said...

After four years of trillion-dollar deficits, the red ink is receding rapidly in Washington

What a fucking lie that is.

Robert Cook said...

"I don't think most Americans comprehend the function of a redistributive change economic model. It is designed to consolidate capital and control in the hands a of select minority (e.g. communist party) and its cronies in the general population."

Odd that you would cite "communist party" as your example given that whatever ghost of the communist party as may still exist in America has no political or financial power at all. Why did you avoid mentioning the actual "select minority" who does benefit?

(Hint: it's the 1%.)

Colonel Angus said...

Funny you mention the 1% in light of the thread yesterday about the daughter of former slaves that didn't pay her fair share to the tune of $500,000.

Nomennovum said...

Well, this bit of good news positively makes me want to break out in song!

Washington DC! It's a hellava town. The taxes are up, but the spending's down!

And I still wanna put Bernanke in a hole in the groun'!

bagoh20 said...

"Um, I have competitors who also pay taxes which I'll assume they are passing on to their consumers too."

Not mine. Nearly all my competition is off shore. Nearly all my former American competitors closed up their shops and opened warehouses to import copies of our products produced in factories not subject to either the taxes or the regulations we are here. The only reason we didn't follow suit is out of pure principle.

If this country is gonna require that to keep jobs here, we will continue to bleed them to other nations.

The other thing about higher taxes is the effect on expansion and investment. Since taxes must be paid in cash and in advance, it robs fast growing, job creating companies of badly needed cash. They are forced to borrow, which raises costs, and often is just not possible.

Regardless of if a company can afford it, it's near sighted to think that moving capital from successful companies to a dysfunctional wasteful government that uses it to artificially raise labor costs (unemployment and welfare) is not disastrous to our nation's competitiveness.

Just think of the simple example of taking cash from XYZ successful company and giving it to the players running Solyndra type operations. It's as if those investors walked into every successful company and demanded a check just because they wanted a new Ferrari. It's really that simple. That's exactly what happened.

Colonel Angus said...

Not mine. Nearly all my competition is off shore.

Since my business is landscaping, I don't have to worry about offshore competition fortunately. That said, my hiring prospects are driven by demand regardless of taxes.

That being said, its not to say higher taxes don't have a detrimental effect on other areas. As I said before, higher taxes mean higher costs that I have to factor in when completing an RFP. When any cost goes up whether its taxes or fuel, it has to be factored in so it may mean cutting costs somewhere else or just lowering my margins. As cubanbob said above, I'm not doing this for my health. I would much prefer lower taxes.

Dante said...

Since my business is landscaping, I don't have to worry about offshore competition fortunately. That said, my hiring prospects are driven by demand regardless of taxes.

Right, inward looking jobs are protected from off-shoring, like construction and landscaping, but Especially the big government sectors. Teachers, police, fire, prisons, etc.

Outside of construction (landscaping, etc), this means service sector jobs increase, which do not export. Seems dangerous to me.

And due to the surge of illegals, at least here in CA, it means young people have a very hard time getting traditional teenager jobs, and opportunities are depressed for unskilled labor.

Dante said...

From the article:

The strategy, however, failed to account for the improving budget outlook. In February, the nonpartisan Congressional Budget Office predicted that this year’s deficit would fall to $845 billion, down from nearly $1.1 trillion in 2012. Goldman Sachs recently predicted that the deficit would fall even further, to $775 billion, and return to sustainable levels within two years.

Who is going to believe Goldman Sachs? And, why aren't these people digging ditches?

dreams said...

Simple math would solve our debt problem but there is a lack of political will. Guess which party wants to spent and to increase the size of government which inhibits growth in the private sector, growth that would diminish the size of government relative to the GDP.

Rocketeer said...

Don't forget that a big bulge of increased tax revenues was also due to wealthy individuals realizing income in November and December ahead of the tax hikes (e.g., George Lucas selling Lucasfilm to Disney, Al Gore selling Current TV to Al Jazeera, etc.).

Hey Al, is that a big bulge of realize income, or are you happy to see me?

Seeing Red said...

Ohhh, how could we forget FSA limitations? I think it was Yale who sent the letter out, sorry, chumps, can't shelter the big bucks in your FSAs anymore thanks to Obamamcare, the limit is $2500 and the rest was taxable.

Alex said...

Cook - you talk alot of about shitty paying jobs. Please tell me that type of jobs Americans should all have.

Jack Wayne said...

Dear Ann, do you not know that the Fed is pumping out $85B/mo in loans to the gov't? That is part of the deficit. So, 750 + 1110 = 1860/yr deficit.

Jack Wayne said...

Dear Ann, do you not know that the Fed is pumping out $85B/mo in loans to the gov't? That is part of the deficit. So, 750 + 1110 = 1860/yr deficit.

Steve Koch said...

Looks like the sequester did some good.

kentuckyliz said...

Obama's a genius!

/sarc

n.n said...

Robert Cook:

The communist party or any other label is irrelevant without identifying their actions and motives. It's not the "1%". The "1%" is not monolithic. It is competing interests. It is composed of the "1%" and the "47%". It is most certainly the faction which supports individual discrimination and elective abortion.

The problem is the faction which exploits differentials and gradients, and people's base nature, in order to advance their own political, economic, and social standing. This happens to be what communists do, and this happens to be what left-wing ideology is designed to accomplish. It is is composed of individuals and cooperatives that prefer to compete through the establishment of monopolies enforced through authority.

The problem is a denial of the terms and circumstances of reality through promises of material, physical, and ego instant (or immediate) gratification without perceived consequences. Denigrating individual dignity has consequences. Devaluing human life has consequences.

stlcdr said...

March Revenue: $186,018 Million.
March Spending: $292,548 Million.

Current debt: $16,828,845 Million (Apr. 30). Note that the government has 'removed' the debt ceiling number (Statutory Debt Limit) from the monthly statement of the public debt: it reads zero. It has been suspended.

This debt is increasing at a rate of approximately $100 billion per month.

Things are not improving; there is no trend closing this gap.

Those who have money - that can be used to help contribute to prosperity - are pretty much running scared. There's no hope in hell an employer will risk hiring anyone with the state of overburdening regulation and the government threatening to increase the tax burden.

Yes, we all know that taxes are passed on to the consumer, but when the consumer price goes up, ones own revenue will drop.