We keep hearing from Republicans that if we return to full employment that the increase in tax revenues will be more than enough to close the budget deficit. This all sounds very good when spoken but does it pass the math test? I decided to take a look for myself and here is what I found: We currently have anywhere from 12.5 to 14 million unemployed individuals in the US. To make sure that I am being more than fair with our Republican friends I am going to use 15 million as the actual amount of unemployed. Republicans claim that if we lower the tax rates and everyone goes back to work then we will actually increase revenue enough to balance the budget. So let's put this to the test: 15 million unemployed all go back to work tomorrow and they earn an average of $50,000 per year, which is actually about four thousand more than the average household income, and we apply a total federal tax burden of 20% (which Republicans want to lower) to them. 20% of $50,000 is ten grand. So, now we take our 15 million newly employed individuals and from them we collect a 20% tax at an average of $50,000 per year for a total of 150 billion dollars. Now, to be even more fair we have to include another variable: since people have more income now they are better able to purchase the goods and services that they need and want; thus putting capital into the economy. Let's be bold and say that the money multiplies by 3 once it is injected into the economy, leaving us with increased revenues of 450 billion per year. This is being very generous.....VERY generous. 450 billion per year sounds like a lot doesn't it? BUT! 450 billion per year would only pay for the bush tax cuts and nothing else. Once we end the war in Afghanistan our budget deficit will be somewhere in the neighborhood of 900 billion. So in truth they would fall short by around 400-450 billion dollars. We can take away the war spending, all of social security and their plan still would not balance the budget. Bottom line: The Republicans claim that they can eradicate the budget deficit with returning everyone to full employment and it isn't true. There is no calculator in the world where their math equals a balanced budget. That said, we shouldn't be surprised: The Republican idea of a fiscal hawk, Paul Ryan, is a guy whose own budget doesn't claim to balance the budget for 30 years, who voted for eveyr major spending bill put forward from 2001-2008 and who signed on to be Mitt Romney's running mate after Mitt proposed a 5 trillion dollar tax cut on top of the already ballooning budget deficit. There is just no rational way to make their model effective. It has been tried over and over and it continues to fail.
You joking right. Are you saying income tax is all you are using for this calculation? How much tax money does the federal government take in? Total federal revenues were $2.16 trillion in fiscal year 2010 from individual income taxes, social insurance and retirement receipts, corporate income taxes, excise taxes, estate and gift taxes, customs duties, Federal Reserve deposits, and some miscellaneous receipts. http://www.dummies.com/how-to/content/how-are-your-tax-dollars-used-by-the-federal-gover.html
Discretionary spending refers to the portion of the budget that Congress approves through the annual appropriations process. In this case, Congress directly sets spending levels of individual discretionary programs, meaning that they may increase or decrease spending on any of those programs in a given year. Discretionary programs include activities such as defense, education, the FBI and the Coast Guard, housing, foreign aid, space exploration, highway construction, border patrol, agriculture, immigration, and emergency disaster relief, among others. The discretionary budget is about one-third of total federal spending. The following chart illustrates the breakdown of discretionary spending for fiscal year 2010.
Where does the federal government spend tax money? Spending by the Federal government is divided into two categories: mandatory and discretionary. Mandatory spending includes programs — mostly entitlement programs — that are funded by eligibility rules or payment rules, authorized by permanent laws. In this case, Congress creates a program and then determines who is eligible for the program, how much each eligible participant will receive, and any other criteria. Spending is then determined by estimates of the number of eligible participants. Congress may change the eligibility and participant funding levels at any time. Mandatory spending makes up about two-thirds of the total federal budget and includes programs such as Social Security (the largest), Medicare, veterans’ benefits, food stamps, along with interest on the national debt. This chart shows all government spending, both mandatory and discretionary, for fiscal year 2010.
My post was simple Pride: Republicans continually claim that if we can just get back to full employment that the increased tax revenues be will more than enough to off set our budget deficits and I showed, in very clear terms, why this is false. Quit trying to change the subject. My post had absolutely nothing to do with all of this bull shit that you copy and pasted from the web. Either what they are claiming is true or false. I say it is false. Why am I wrong?
The tax code isn't simple and what you did was waste space. There is no way you can calculate out in that post what 15 million workers would add to the revenue of the US. The simple dummy chart shows where the US gets ALL of its income. Unless it is wrong, it shows that only 42% of the revenue is from income tax. SO I don't know how you are going about calculating the rest of that shit to support your claim.
You don't have to rely on my math, Pride. You can get a calculator and do the math for yourself if you like. The Republicans like to claim that if all of these 15 million workers were to re-enter the work force then our entire budget deficit would be erased and it just isn't true. I was more than generous with all of my variables in estimating what the increased revenue would be so unless you can prove me wrong mathematically then you have nothing to stand on. You copy and pasted some pie charts off of the internet, which is par for the course for you because you possess no capacity for original thought. You tried to pull out one number as evidence that I am wrong but you left out some keys points: 42% are federal income taxes 40% are revenue collected for social security and medicare, which come out of your pay check and are a part of the 20% I quoted 9% are from corporate taxes which are currently part of the equation so they require no inclusion. furthermore, when I described "multipliers" that would include the extra corporate taxes that would be collected as a result of full employment. the remaining 9% are variables that do not fluctuate: people die, goods get exported and imported regardless of the economy. Furthermore, even if your claim that tax revenues only amount to 42% of the total federal revenue then how would you explain the fact that the Republicans claim that just by creating full employment (if they could) they can erase the federal deficit? If your claim was correct, which it isn't, it would make even less sense for the Republicans to make this argument.
I didn't make any claims other than you wasted space. There is not a single shred of evidence of why anyone should trust your math. Having full employment would effect so many other things that what you listed.
so, in other words, you have nothing. if there isn't a single, shred of evidence, as you claim, then prove me wrong. show us the numbers just as I did. what other things would full employment effect? I've already listed a good many of them and taken those into consideration. if I am wrong then show us, don't tell us. Just telling us makes me think you have nothing.
Uh. The pie chart clearly shows where the income comes from. What is that saying. The burden of proof is on you. Your numbers are backed by nothing. You set the deck and played cards with yourself.
