Who will take on Obama in 2012?

Do you not recall that the Democrats from Obama's term did nothing but spend money? How can you say, let alone with the arrogant willpower, that it's all on the House if we default? Where have you been the past 40 years?

Because that has nothing to do with it. We don't default if we raise the debt ceiling. And, oh, it was only Democrats spending more money than we have? Remember the surplus under Bill Clinton? When did deficit spending once again go out of control? Under Bush. And what did Republicans say at the time? Never mind worrying about deficit spending because the war on terror is more important. And they also cut taxes while spending much more money making the deficit even worse. That is the Republican stimulus plan. Blame it all on the Democrats. And that war on terror included an unnecessary and expensive invasion of another country under false pretenses, for weapons of mass destruction that did not exist.

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It reminds me of a toilet paper on the trees
- Paula

The debt ceiling, oddly, has nothing to do with debt at all -- i.e. spending from debt -- because debt is theoretically infinite while the debt ceiling is arbitrarily finite. If we had no debt, the debt ceiling could still be raised and lowered, and it would be just as arbitrary. From another perspective, if we had 1% of the debt we had now, the debt ceiling could theoretically be lowered to the point where we default on that minimum amount of loans.

Conservatives want to see default, because they believe that it will teach out country a lesson about debt and its consequences. In other words, they want to cause suffering in order to shock and awe us into more conservative policies. They will say: "do you see what debt hath wrought?" What they fail to see is how the consequences of debt only become actual when we default. Therefore, they become the ones actually responsible for the entirely of the consequences, since they can be entirely avoided. Without the possibility of default, debt remains meaningless, since we can theoretically continue to spend from it forever until the end of time without any repayment or default whatsoever.

I admit that this is not a beautiful or noble scenario; this is just the nature of capital as abstraction: infinite debt, infinite credit. What becomes ignoble is the deliberate subjection of the people to suffering.

No.

Well, if you believe in the "wisdom of the market" alone you are certainly not a pragmatist.

__________________
"Loves them? They need them, like they need the air."

The market does nothing for me.

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“The gladdest moment in human life, methinks, is a departure into unknown lands.” – Sir Richard Burton

I'm generally conservative on most economic issues, and I certainly don't "want to see default." Nor have I heard anyone with a truly conservative approach and understanding of economics voice such a silly position. This of course does not include the foolish talking heads who make a living claiming to know what "conservatives" and "liberals" think or want, nor the amateurs in this forum who persist in pigeon-holing themselves and their political opponents.

Personally, I think it is far too late to teach the voting public anything about economics because too few in this country have the slightest knowledge of or interest in the subject. I also believe one should be extremely cautious in trying to teach the US public any lesson via politics because the masses are more likely to learn the wrong lesson or will even carry the right lesson to extremes.

True, any level of anything decided by politicians is arbitrary. But there would be no reason to raise or lower the maximum of a non-existant debt. And certainly there would be no pressure to do so by a certain date if there would be no danger of default, no debt to repay, and apparently no reason to create debt.

Yes, and without the possibility of eventually hitting the ground, falling from a balcony on a building's 18th floor would be meaningless, too. But that's not how the real world works, as my second ex-wife eventually learned to her dismay. Like Congress, she thought she was not broke as long as she had unused checks in her checkbook and available credit on her credit cards. And like Congress--and apparently most US citizens lining up for government handouts--she thought there would never be a financial day of reckoning.

In her drive to satisfy her champaign tastes on a beer income, she frequently would get telephone reminders that a payment was late on some debt. In a panic, she would then write and mail a payment knowing she hadn't the cash in the bank to cover it and would not receive additional income from her work in time for the check to clear. So after mailing the hot check, she'd drive to a credit card ATM and obtain cash on her credit card, which she then deposited in her checking account to cover the check she just wrote. When the credit card bill was overdue, she'd go to another ATM to obtain money on a second credit card to cover that check. This was her normal operating procedure despite my gentle warnings that eventually she would max out all credit cards, become unable to acquire more, and would not be able to make minimum payments on a huge amount of debt at high interest rates.

I eventually was proven right, but not before she maxed out her credit cards which I then had to pay off as part of the divorce settlement. She apparently started with a clean slate and was able to obtain more credit cards, probably because of the additional income she received from me in payment of child support. I never resenting paying support for my children, and it was no major burden as I had continued paying the mortgage, utilities, taxes, and charge accounts through our long separation and divorce proceedings. Once the divorce was finalized, I even managed to rebuild some of the college fund I had started for our oldest son but which his mother had cleaned out balancing her overspending. A couple of years later she again had run up huge debt and declared bankruptcy. Since then, she has borrowed regularly and heavily from our surviving son.

Always thought she would have been a great addition to Congress--she could have taught those pikers a thing or two about mismanaging debt.

Likely because like most people you have minimal knowledge and understanding of it.

The market is where I buy my food.

Let's hold on to this sentiment for a moment.

Actually, that is how the real world works, because "the real world" in this case is almost completely determined by institutional language. Isn't this what is precisely so troubling about the state? The fact that it is largely a fiction? The state literally creates the ceiling from nothing. There is no natural formation or limit. It is merely declared and it becomes so. This is the vast power of the state, the unfortunate "real world" we must live in.

So when conservatives such as yourself warn against "hitting the ground" or "the day of reckoning", this threshold is entirely created by the conservatives themselves. It is therefore entirely their doing if people end up suffering because of the insufficient funding, since they are the state and it is entirely within their power to prevent it.

I get it, I get it. It's the classic misogynist stereotype, but I suppose I believe you. Let me guess, she also slept around too, right? Okay. So, you were smart, and she was dumb. Therefore, conservatives are completely correct about the federal debt. Yet, not only does this example entirely miss my point about the arbitrary nature of the ceiling and constitutive role of the state in its very existence; it is also a fundamentally inappropriate analogy, because of the massive, massive differences between the desires of a flesh and blood person and the duties of an abstract state with immeasurable power.

Simply, a person =/= a state. Another way to say this might be microeconomics =/= macroeconomics. However, I can already guess that you are a person who does not believe that the latter exists, so there can be no further discussion here in the way of economics. Apparently, this is where your supposed "understanding" of the economy ends.

As I said before, it is all size scale obfuscation, and it is the root of all conservative rhetoric. Conservatives always like to portray the federal debt as if it were precisely the same thing debt as that of your female friend. They entirely fail to recognize the immense role of the state in the very viability of capital itself.

Excuse me, but didn't you say you didn't want to see the default? And yet there is this smug satisfaction in recalling this story of your irresponsible friend and her "day of reckoning" -- the very same smug satisfaction that I spoke of earlier ["do you not see what thy debt hath wrought?]. Call it pidgeon-holing if you want, but it seems very unambiguous to me precisely what the "moral" of your story was: I was smart, she was stupid, and the day must come where she must pay for her stupidity. Except here, the girl is instead the federal government and all the people who will be affected by its default.

But think for a moment. What if you were the one with the power to completely forgive her debts or at least give her an extension with essentially no harm to anyone, including yourself (which is precisely the kind of thing that a state can do that no actual person or bank ever could). Then clearly your decision to lay down a "day of reckoning" (most likely in the hope of "teaching her a lesson") is clearly one of cruelty, though patriarchal cruelty is so easily reinterpreted into love, isn't it?

The true tragedy of this crisis will be -- in the event of a default -- the undue blame that will be put on state spending instead of the Republicans' self-constructed tribulation. This is the state at its absolute worst: the state as oedipal father. I admit it. Perhaps we have been stretching the role of the state as "really nice guy who gives us stuff even though he can't afford it" a little too far, but this does not warrant the present conservative turnaround into "wrathful vengeance" and "day of reckoning", as you so put.

"I get it, I get it. It's the classic misogynist stereotype, but I suppose I believe you. Let me guess, she also slept around too, right?"


Did she sleep around, rufnek?

I used to have this crazy gf with a gambling problem who couldn't hold on to money either. Maybe this is why we shouldn't make Sarah Palin President. I bet she maxes out her credit cards also.

Now the leadership signed off on a deal it will be interesting to see what the rank and file's reaction will be. The Senate no doubt will pass it with bipartisan support. Nancy Pelosi is reportedly not happy but she won't hold it up. She won't defy the President on something like this especially if it gets the green light in the Senate with Harry Reid's blessing. But watch House Republicans. More revolt against Boehner again, but most likely enough Republicans will join Democrats to pass it, but Tea Party will again whine. Will he survive as Speaker? But the Tea Party has shown they are completely incapable of running this country unless they have one of their drinkers in the White House and that has become increasingly unlikely. I now think not even Perry can stop Romney, just slow the momentum down in parts of the South. The nomination is his. The Tea Party gave it to him.

Right. And there's absolutely no significance to the fact that you chose not to compare their "fanaticism" to something more benign, like overzealous sports fans, but instead chose to compare it to mother-flipping terrorists.

Seriously, listen to yourself. It's ridiculous enough that you've made this comparison. Please do not compound that ridiculousness by making me explain why it's ridiculous.

I'm going to reply to all of these at once, because one thing answers them all. And it's something I already said, too:

You have no basis from which to say that the Republicans are "creating economic armageddon" because 1) Democrats can agree to cut spending, and 2) it's the spending that put us in this position to begin with. It's like borrowing money from your parents and then blaming them for ruining your credit when they refuse to loan you more and point out that you could just spend less. It is simply false to suggest that the only culpability lies with the party asking for spending concessions, and none lies with the people doing all the spending. So unless you think debt ceiling hikes should be automatic, and should happen without any assurance that spending be curbed, then this talking point is empty. Sorry, but the fact that it makes for good rhetoric does not make it fair or accurate. It isn't.

The problem with all of these arguments, really, is that they assume that what the Tea Party wants is unreasonable, and that what the Democrats want is reasonable. But you don't get to assume that in a political disagreement your side is the reasonable one. Every side in a political disagreement thinks it's the reasonable one. That's why there's a disagreement in the first place.

You seem to think that you can make this assumption based only on the fact that Democrats are apparently compromising. But the fact that the Democrats are willing to compromise on what they want tells us absolutely nothing about who's being reasonable. Reasonableness is comprised of not just flexibility, but correctness. If someone wanted to raise taxes by 90% across the board, and then "compromised" at 25%, that would not make them reasonable. It means their initial stance was very unreasonable.

This means that your entire argument about this "fanaticism" is based on a presupposition. And since I don't share your presupposition, and you have advanced no serious argument to explain why I should, your claim does not require an explanation from anyone who doesn't already agree with you. Simple. You have to make an actual, economically-grounded argument. If you don't, then this is all an elaborate way of reminding me that you simply agree with Democrats. Which I'm pretty sure I knew.

I'm only pointing out that it failed, and that people are still clinging to the thinking that produced it. It honestly doesn't matter to me if you classify this as an agreement between us or a concession on your part. The important part is that it's true.

And the comparison is not irrelevant, because it's not meant to make a point about the debt ceiling negotiations. It's meant to make a point about what gets labeled "fanaticism" and what does not. It is, like so many other things, a product of one's political allegiances. You talk about the Tea Party's allegeded fanaticism as if it were something both Republicans and Democrats ought to be able to agree on, but when examined it's clear that there's no reason for it. You're not making the accusation from a common ground, you're making it from the ground you were already standing on.

This is just empty. There is nothing, anywhere, which supports the idea that you need to have some inherent "balance." There's no such thing as a necessary balance between a good idea and a bad one. There is no metaphysical principle which says that splitting the difference between whatever happens to be the primary economic positions' of the major parties at any given time is a good thing.

Even if we agree that society needs a "balance" of taxes and spending, that would tell us precisely nothing about which direction we're out of balance in. Most Republicans say spending is too high. Most Democrats say taxes is too low. So if you want to make an argument about "balance," you can't just say you want balance, as if that's supposed to constitute a position.

Sure it is. Because I'm making the case that fanaticism is overlooked when one mostly agrees with the fanatics. I'm making the case that whether or not you're a fantatic or brave and principled is largely a product of whether or not you're right. And I'm also sorta-kinda making the point that make what qualifies as "fanaticism" is too sensitive, if the word seems to describe so many people.

I don't know how to address claims like "only some" or "many were." If you advance specific arguments, I will offer specific rebuttals. But you're right about one thing: "there wasn't going to be a stimulus passed large enough to satisfy them." That is precisely my point! The failure of stimulus will never convince them that their ideology is, at least in this area, misguided. It will always be rationalized by saying they did not do enough.

Here's the argument, in a nutshell: if a political position which treats both success and failure as confirmation of its position is not fanatical, then nothing is.

I'd say Keith Olbermann ranks up there with any of them. "Worst Person in the World"? Hyperbole, much? And I dunno how much of Air America you listened to, but it really wasn't any better.

Conservative dominance in perceived meanness is probably a product of conservative dominance in radio and, to a lesser extent, television. When you have more media personalities in general, you'll have more angry ones, too. But I don't this indicates some special virtue on the part of progressives.

Obama, February of 2009, selling the stimulus package:

"Millions more Americans will lose their jobs. Homes will be lost. Families will go without health care. Our crippling dependence on foreign oil will continue. That is the price of inaction."

This kind of stuff was coming out all the time. I can find more pretty easily, but I didn't figure this would actually be a point of contention (is it, really?). It wasn't that long ago; I'm sure you remember all the quotes like this about all the terrible things that would befall us if we didn't pass the stimulus, just as I do. Of course, most of those terrible things happened even after we did pass it.

Of course the other side does that. Again: I'm not accusing Democrats of being the only ones who demagogue things. The equivalence you're drawing is my entire point.

You heard it here, folks: spending money we don't have and going into debt for it somehow has nothing to do with the fact that we're up against the debt ceiling. That's the corner Democrats have to argue themselves into if they won't part with the "holding our economy hostage" line.

The problem here is that you start with the assumption that the debt ceiling must be raised, and you pile on top of it the assumption that it should somehow not matter why we're about it to hit it. That's a neat trick, stripping out all history and context in order to make an accusation. Then it becomes easy! So yeah, once you make that assumption and completely ignore what got us here, then it's totally the Republicans' fault. But at that point you've defined the problem in such myopic terms that it's a hollow accusation.

Er, some of them complained. That's one of the reasons you saw Bush's approval rating drop later in his term. But this isn't an appropriate comparison, anyway, because the deficits under Bush were less than half what they are under Obama. And they're worse, because they come after we've already been running previous deficits.

You're probably the hundredth person in this thread and other similar ones to try to draw a false equivalence between Bush's deficits and Obama's. It's a nonsense comparison. And yes...

...it does, in fact, matter what we spend it on. Nobody complained about the debt we racked up during WWII or the Revolutionary War because we had to do it. We don't, however, have to spend a trillion dollars on stimulus.

Well, first of all, this doesn't contradict what I said. The response is fanatical because it barrels ahead in the face of unmitigated failure with a major amount of money. The fact that it might make up only a "small percentage of GDP" (around 6%, I believe) doesn't change this.

Secondly, pick your poison: either the people who supported the stimulus either a) lied to a tremendous degree about what it would do, or b) were incredibly ignorant as to what they were actually capable of fixing.

But of course, it's not one data point. People have been trying to stimulate growth with government spending forever. This isn't really "one data point," it's just the latest one.

Your timing is amusing because my wife, while researching a book, came across a fairly hysterical anecdote from 11th century China that details an elaborate government program to lend money to farmers because it was decided that private interest rates were too high. Remind me to share it with you at some point. It's not stimulus, exactly, but the folly of government control in all its forms is not a new thing at all. It's been going on for a millennia.

Boo! Fallacious descriptions everywhere. For shame! Shaaaaame!

Okay, back to being serious: there is nothing mysterious about market forces in a broad sense, nor are they thought to be all-knowing, all-good, or all-powerful. Here's what they actually are, in the same order:

1) Not mysterious, but merely not knowable by individual humam beings, since they consist of literally trillions of decisions.
2) Not all-knowing, but knowing more than small groups of people.
3) Not all-good, but merely better, and with the added virtue of being the product of choice rather than diktat.
4) Not all-powerful, but merely based in reality and not easily changed or ignored.

The fact that people sometimes talk about these things with language that evokes the same sorts of images as a religion does not mean it is inherently mystical or mysterious or any of these other things (though Adam Smith did sort of believe that...but even so, that's not really a critique of its validity, anyway). At it's core, belief in the market is this: individuals know more about their own lives and circumstances than governments. People close to financial decisions understand them far better than people far removed from them.

Also, I'm not sure what to make of the straw man that conservatives "assume...that absolutely no discernible mechanics exist at all." Who the heck thinks that? Conservatives sure don't. If they thought there were not mechanics or ways to affect change at all, they wouldn't mind government intervention because they'd think it ineffectual. But of course, they do fear goverment intervention, because they know it does affect things. They just don't think these mechanics can be effectively manipulated by individuals to bring about the kind of good that is so often suggested.

This is a misrepresentation of the free market position. Supporting the free market is the opposite of having faith in a single power, because it is actually faith in many people acting independently. It is referred to in the singular for semantic convenience, not because the free market is actually a single source. It is anything but.

Also, the comparison is also lacking in that a fair comparison, if you wanted to erroneously count "the free market" as one single force, would be countered by all ideas that government can tweak the economy. If you're going to lump everything together under one heading, you have to do the same with the idea that you can control significant portions of the economy, in which case your comparison is not a single power versus disparate liberal ideas, but one single power against another. If you get to caricaturize free market types, I certainly get to caricaturize statists (in their many gradations). Though it'd be better if neither of us did either, eh?

I don't really disagree. I think most mean well, which sadly can make them even more dangerous.

We discussed this in private a bit, and I might owe you a PM to this effect, but my response here is similar to something I sent you awhile back: this is not about preventing suffering, or not. It's about considering all suffering, including the suffering you might inflict. That can't be ignored. It is no less real.

It also lumps all of life's difficulties together under the fairly loaded word "suffering." As if every government program were about helping someone who's in terrible pain. As if it's really accurate to say that someone who wants unemployment benefits to last less than two years is being indifferent to people's suffering. In practice, we are long past base forms of suffering. Most debates about spending and taxes are far beyond these marginal hypotheticals.

Also, I award progressives exactly zero points for "at least...searching for solutions." It is not less important--and no less part of living--to have the humility to accept what you cannot control. You could use this same logic to support dictators, because at least they're trying to control their states and searching for ways to do so, rather than lazily trusting in a messy thing like freedom to make their decisions for them. There is absolutely no shame in coming to the conclusion, based on the observable evidence, that economic freedom produces wealthier, happier, longer-living societies in general, and that attempts to control it are haughty and often end in ruin. There's no reason to label the contrasting opinion as noble as opposed to arrogant, or bull-headed.

You know all this already, though, don't you? You just know it under the heading of Philosophy instead of Economics. The admission of one's own ignorance is the beginning of wisdom. There is nothing shameful about recognizing that we cannot control economies. In fact, even using the word "economy" here obscures how arrogant the idea is, for it's not economies that they wish to control, but large masses of other people.

Pfft. See above for why there's nothing mystical about this. Though fanatic or not, mystical or not, it has the virute of being grounded in positive, observable consequences. And I could just as easily and erroneously suggest that Democrats "worship" government and its ability to change the world in lieu of individual responsibility. But as I said before that, like the quote above, would be a huge stretch, and an unfair caricature of an opposing viewpoint.

No way. I'm a conservative, and I don't want it. Huge swaths of the Republican party do not want it. I'm sure some think this way, but they're not the majority.

The fact that someone like rufnek might derive some small sense of pleasure from seeing his warnings come to bear on a foolish person doesn't really contradict this. If you applied this thinking consistently, you'd find yourself also making the argument that people who opposed the Iraq War wanted soldiers to die, and all sorts of other things that we can probably agree are unreasonable.

Politicians often find themselves in the awkward position of predicting doom and therefore, in a sense, seeing an interest in it happening. But this is nothing new, nothing specific to conservatives, and I don't think it applies much given that a default would affect all of us.

What you're saying is somewhat helpful, I'm sure, for clarifying for some people what debt actually is. But it's too far to say the consequences of debt are "meaningless." See below for why.

Yeah, but who believes in that alone? Who believes in any one thing alone? Straw man!

This is not true. Though the language is often muddled, there are real consequences to extreme levels of debt. Among them are:

1) Our credit rating gets downgraded, as is on the verge of happening right now, which means higher interest rates, which means everything we borrow for costs us more.

2) People refuse to buy our Treasuries, or at least do not do so as reliably and promptly as they did before.

3) Some combination of the above forces us to make more drastic cuts down the line.

And, of course, this all assumes that we merely continue growing at a sufficient pace to pay off the rolling debt. Which we do...but we wouldn't, necessarily, if we kept spending, because that spending does not merely happen, but is indicative of other economic controls and regulations and taxes and the like which harms growth. I'm not sure if it's accurate to say that we can rack up as much debt as we want and always pay it off (though it's certainly true to some degree of debt), but I don't think it's accurate to forecast that the things we do to rack up that debt will not harm the possibility of that growth continuing.

We didn't have to invade Iraq. It was not a necessary war like WW II. Hussein was not an immediate threat to us at the time or the rest of the world. He had no weapons of mass destruction. 911 was used as cover by the neocons to take care of what they regarded as unfinished business. And the war for many years was badly mismanaged and billions of dollars was wasted or stolen. The stimulus money went to the states who needed it and roads were built and other things. It may not have sufficiently stimulated the economy. It was spent on useful things. it didn't disappear into a black hole like so much money spent on the Iraq War.

Yeah, again: you can't just say this. You have to demonstrate it. Make a substantive argument. Repetition doesn't count. Blindly accepting the Democrats' starting point doesn't count. Comparing them to other Republicans doesn't count.

1) "On this road" means nothing. It's not gravity. Obama can continue certain things or not.

2) Obama doubled down on this policy, and added more of the same on top of that. He's fully responsible for these choices.

3) The deficit "ballooned" to much lower levels than it has since. As I keep saying, you cannot equate them. They are not equal.

4) I'm mad at Bush for some of these things, too. You're not going to catch me saying that everything Bush did was fantastic, and that if he did something I therefore lose the ability to criticize Obama for it.

If a Republican President had signed a similar stimulus package, I'd be mad at them too. And if Obama had just cut taxes, I would've loved that. But neither has happened, so this is irrelevant and in no way addresses my criticisms.

Maybe it's true that any President, Republican or Democrat, would "have" to pass a stimulus package. But it matters not one whit to what I'm saying. And the reason they'd have to is that people blindly accept the idea and only question it after it's already failed.

From his reelection to mid-2007 they dropped 16% among Republicans. That seems pretty significant to me, given how rarely members of a party come to disapprove of their own standard-bearer. And that DOESN'T include people like me who supported him overall, but didn't like specific things.

Of course it's because they spend it on things I don't like! Good grief, has this discussion become so muddled that you think this is supposed to make me look bad? Yes, WHAT you go into debt for matters. Of course it does.

But, also (and this is the argument I see you've chosen not to address), it's not as big as Obama's deficit. It's not even that close. So, yeah, I might find one deficit run for an understandable reason far more tolerable than a deficit TWICE the size for a policy I think is wasteful. Guilty as charged.

First, you said this (about roads and such) before, and I already cited you the numbers that show that very little went to infrastructure, and that the biggest chunks when to entitlements (which, whether you realize it or not, is actually what you mean when you say "the states." A huge chunk of it went to propping up Medicare).

And I think it's more than a little haughty to say that the money in Iraq has "disappeared into a black hole." Perhaps I lack the tremendous historical vision you possess, but to my mortal eyes it seems like these things are judged on a much larger time scale, and that it's still far from unthinkable that Iraq will be a relatively free country in the coming decades, and if it is, such complaints will look often petty in the broad sweep of history.

Maybe it'll look foolish, and maybe it won't. But you don't get to assume the former any more than I get to assume the latter.

Okay, back to Piddzilla! Sorry for the delay; as you can see, I got a little caught up. And sorry that this isn't as short as I wanted to make it. Can't be helped.

By the by, I'm always a fan of steering these discussions into hard, testable economics, too. It keeps the conversation a lot closer to reality. So thanks for taking this tack.

The interest paid on U.S. Treasuries does not compound, so it's not really exponential, no, thankfully.

Oh, I think it absolutely would. We have a $14 trillion a year economy. As long as we're not spending far more than we take in, we can cover quite a bit of debt very easily. If we were to seriously curb entitlement spending and/or get the economy growing at even 3% regularly, it would have a dramatic effect on the deficit.

Out of curiosity, why should markets "favour small and medium sized actors"? And how should it do so?

We sort of agree here. We probably disagree as to the reforms needed, but I agree completely that you don't just go around patching holes in the dam or trying to buttress this industry or that. If you have to do that, then there's another problem somewhere, and that's the problem you need to deal with.

You say we need more money, not less. But the other way of looking at the debt problem is that we need to spend less money, not more. When you're in debt, you can increase income or you can cut spending, or some mix. But the thing about trying to balance the books by increasing income is that you get diminishing returns, since "increasing income" means taxation, and taxation inarguably harms economic growth.

I think this is a common fallacy: the idea that we have "room" to do this or that. It's a sliding scale, not a big bright line. The proportion for which we have room to raise taxes is really just the proportion we are willing to harm economic growth for some other end.

Oh my. I think I actually let out a little gasp when I read this.

The idea that increasing taxes would "force companies to produce more goods in order to pay the taxes" is backwards. By this logic, you could keep raising taxes forever and it would only cause people to produce more and more!

The general rule is, barring absolute necessity for survival, when you tax something you get less of it. This should be obvious, because a tax is a penalty. A more taxed industry has less incentive to expand than a less taxed one. Heck, we even use the word "taxing" to describe strenuous activity of all kinds.

Companies do not produce more when they are taxed more, they produce less. They are more hesistant to expand, more hesitant to invest in new machinery and techniques, more hesitant to innovate and take chances. And investors are more hesitant to invest in them as a result. Lowering taxes is what spurs these things both businesses both large and small. In small businesses, it lowers the barriers to entry and the procurement of investment money. In larger ones, it makes it easier to expand or enhance distribution.

To my knowledge, this principle is pretty much a given in all economic circles. There are still economists who favor higher taxes for a variety of reasons, but they do so in acknowledgement of the tradeoff or because they believe it brings more value in some other way. But it definitely harms business and causes less production. How could it not? Taxing a business more isn't really any different than telling a factory to operate with one less production plan, or one less machine.

+1 million points for recognizing that the cost of living/products will become more expensive. That's the component I feel that people just flat-out ignore, or don't realize. Just as the benefit to business is almost invariably dispersed throughout the economy in the form of lower prices and increased availability, the harm to business is also dispered in the form of higher prices and decreased availability.

So, in that sense your suggestion is logical: you can't just punish business to make up the difference. You would have to discourage and reduce consumption across the board. You're advocating broad austerity. I'm not clear on whether or not you want it to be required, or just voluntary, however. And personally I don't think it's necessary at all. But I'm impressed by the internal consistency of the conclusion, if nothing else.

On a factual level, however, I disagree that this would help the 3rd world. When they're not paid enough it is invariably due to trade barriers, transportation costs (which have to be factored in), the nature of their governments, or the simple availability of labor. You say they produce most of what we consume, but then you also say that it would be good for them if we consumed less. But that means we'd be buying less from them. How would that help them? Why would they want fewer customers?

I don't want to divert the entire discussion into healthcare, but very briefly I do want to say that I think it's a common misconception that what we have now is the result of a free market system. I have often heard it argued that private health care must not be a good idea, because it's so expensive here. But we don't really have a free health care system here at all; it is heavily regulated and subsidized already. We can't even buy health insurance across state lines! So whatever one thinks about health care as a right, or whether or not it can "work" through competition the way basically every other service does so well, I don't think we can point to the U.S. health care system as it currently stands as an example of free market failures. It's actually a bizarre mix of philosophies.

Food and sex are, technically speaking, the most important things for the human species to go on living. Should government control either?

Amusingly, I tend to think that they're too important not to capitalize. I tend to think the most important things should largely be in the hands of the people directly affected by them.

Aye. And I think capitalism and democracy, in tandem, give them that more than any other system. They collectively choose their leaders and they collectively decide which innovations and production techniques and decisions to reward. Certainly, even if you find socialism preferable, you must admit it fails the test of allowing people to have some degree of control? People will not feel in control if they feel that their efforts in business and work sit at the whim of a handful in government.

Sidebar: do you guys think this weird shooting pain in my wrist has anything to do with the fact that I just wrote, like, 5,000 words?

So are we turning this into a book called "Why Democrats Suck At Arguing"

If so, then this is just the introduction/prologue. MUAHAHAHAHAHA. Got finals today unfortunately.

p.s. another name for this book would be How the Liberal/Conservative Antinomy is Irresolvable Except Through Their Synthesis.