Fox's Cavuto so wedded to tax cut mythology that he wrongly corrects his guest
Fox News host Neil Cavuto forcefully accused his guest, Democratic strategist Chris Hahn, of lying when Hahn said of the Bush tax cuts, "For every dollar you spend in tax cuts, you get back 30 cents to the economy." In fact, the figure Hahn cited is both accurate and well documented.
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Cavuto shouted down guest for reporting figure confirmed by independent economists
Cavuto claimed Hahn's numbers are a "little fib." During the November 19 edition of Fox News' Your World with Neil Cavuto, Democratic strategist Chris Hahn said of the Bush tax cuts for upper-earners: "The tax cuts cost us $700 billion and for every dollar you spend in tax cuts, you get back 30 cents to the economy." Cavuto responded by accusing Hahn of fabricating the statistic, calling Hahn's figure, "the most bogus number I've ever heard." Cavuto then repeatedly denied that the Congressional Budget Office had come to that same conclusion:
CAVUTO: Chris, love you dearly, but you're inconsistent here. You said the tax cuts shouldn't happen because we can't pay for them and they're going to worsen the deficit. Now you're saying the jobless benefits are OK, even if they worsen the deficit. Which is it?
HAHN: Well, you know, let me put it to you this way: The tax cuts cost us $700 billion and for every dollar you spend in tax cuts, you get back 30 cents to the economy. The unemployment benefits --
CAVUTO: You just made that up, Chris. You just made that up. That --
HAHN: No, I did not.
CAVUTO: That is the most bogus number I've ever heard.
HAHN: The Congressional Budget Office made that up --
CAVUTO: No, they didn't.
HAHN: -- not me.
CAVUTO: No, they didn't.
HAHN: And these are numbers that have been around for a very long time.
CAVUTO: No, they didn't.
In fact, Hahn's statement is backed up by CBO analysis and Mark Zandi
Hahn's numbers correspond to the findings of a CBO report. In January 2010, the nonpartisan CBO released a report estimating the economic effects of several policy options, including extending the Bush tax cuts for one year. CBO found that the tax cuts would boost GDP by between 10 cents and 40 cents per dollar spent, providing the smallest amount of stimulus of all the policy options considered.
From the report:
CBO: Allowing Bush tax cuts for the top brackets to expire is "more cost-effective" than extending all of the cuts. In the report, CBO stated that extending most of the Bush tax cuts for one year but allowing the cuts for the top brackets to expire would "cost less than would deferring all of the scheduled tax increases, and it would be more cost-effective because the higher-income households that would be excluded would probably save a larger fraction of their increase in after-tax income." However, CBO said the difference "would be small." From the CBO report:
CBO estimates that a two-year AMT patch and one-year deferral of the EGTRRA and JGTRRA tax increases would raise output cumulatively between 2010 and 2015 by $0.10 to $0.40 per dollar of total budgetary cost. CBO also estimates that the policy would add 1 to 3 cumulative years of full-time-equivalent employment in 2010 and 2011 per million dollars of total budgetary cost. Although the effects of this policy per dollar of budgetary cost are smaller than the effects of extending ARRA's tax credits, the dollar amount of tax cuts under this option is substantially larger, so the total effects on output and employment also would be larger.
One variant on this option is to defer most of the tax increases in EGTRRA and JGTRRA for one year but allow the rate increases for the top brackets to go into effect. This option would cost less than would deferring all of the scheduled tax increases, and it would be more cost-effective because the higher-income households that would be excluded would probably save a larger fraction of their increase in after-tax income. However, the difference relative to the option analyzed here would be small, because much of the remaining tax reduction would still go to higher-income taxpayers--largely because of the changes in the AMT and other income tax changes.
A related option is to permanently eliminate the scheduled tax increases in EGTRRA and JGTRRA. A permanent extension would have a bigger effect on demand in 2011 than would a temporary extension, because households that expected higher after-tax income in subsequent years would spend a larger share of the additional income they receive in 2011. However, a permanent extension would entail large revenue losses after the recovery is over, so its effects on output and employment in the next few years per dollar of total budgetary cost would be much lower than those of the one-year deferral analyzed here.
Economist Mark Zandi also corroborates these numbers. On April 14, 2010, Mark Zandi, the chief economist for Moody's Analytics and a former economic adviser to John McCain's presidential campaign, testified before the Senate Finance Committee on the virtues of extending unemployment insurance. His testimony stated that the "Bang for the Buck" of making the Bush income tax cuts permanent was only $0.32 per dollar spent. Conversely, the "Bang for the Buck" of extending unemployment insurance benefits was $1.61 per dollar spent. From Zandi's testimony:
Cavuto dubiously claimed extending high-end Bush tax cuts would cause businesses to increase hiring
Cavuto: "[S]houldn't businesses be the ones who see their taxes cut so that they can hire these same folks for whom we keep extending their jobless benefits?" During the discussion of the relative merits of extending the Bush tax cuts for high-earners and extending unemployment insurance benefits, Cavuto said:
CAVUTO: Chris, then let's assume you're right. Let's assume you're right. You're not, but you're -- let's assume you are. That these jobless benefits, every time we pay for them we're not worsening the deficit, it's improving. Last time I checked, the deficit is getting worse, far worse. And every time we extend them -- and I'm not callous about this, I think we should do something to help those in hard times --
HAHN: Absolutely, we should.
CAVUTO: -- we got to find a way to pay for it, because your magic elixir here that this is somehow paying for itself and then some, it ain't panning out.
HAHN: Well, you know, it's putting money back into the economy, putting money back into our economy right now where people are actually spending the dollars. Tax cuts, people don't necessarily spend them. That's the problem.
CAVUTO: How do you know? Let them decide what they do.
HAHN: That's why I say we must pay for tax cuts.
CAVUTO: Let businesses decide what they do with it. I mean, shouldn't businesses be the ones who see their taxes cut so that they can hire these same folks for whom we keep extending their jobless benefits?
CBO: "[I]ncreasing the after-tax income of businesses typically does not create much incentive" for them to hire. From the CBO report:
Deferring the scheduled increases in tax rates in 2011 would help some businesses as well as households. In particular, it would keep lower tax rates in place in that year for businesses that do not pay the corporate income tax (the pass-through entities such as sole proprietorships, partnerships, S corporations, and limited liability companies). However, increasing the after-tax income of businesses typically does not create much incentive for them to hire more workers in order to produce more, because production depends principally on their ability to sell their products.
Vast majority of small businesses would not be affected by allowing Bush tax cuts for the wealthiest expire. According to the Tax Policy Center, 2.5 percent of taxpayers who report business income on their individual tax returns would pay higher rates under the Democrats' plan to extend all of the Bush tax cuts except for the top two income tax brackets. The Joint Committee on Taxation similarly stated that "three percent of all taxpayers with net positive income" would see higher taxes under the Democrats plan. Both TPC and JCT added that even among that small percentage, it is not clear how many of those affected are entities that we would consider "small businesses" and how many represent enterprises like law partnerships and real estate investments.
Cavuto's disbelief of expert analysis fits into a pattern of Fox News economic know-nothingism
Fox anchor purported to debunk an accurate claim about the income of small business owners. On Fox News' America's Newsroom, anchor Martha MacCallum disputed Democratic strategist Maria Cardona's assertion that "[n]inety-nine percent of small businesses do not fall into the top one percent of income earners in this country." MacCallum responded that "half of the people who make over $250,000 a year in this country are running a small business." Not only was Cardona's statement accurate, but MacCallum's seems unverifiable.
Ignoring CBO analysis, Fox has repeatedly claimed that ending Bush tax cuts for wealthy would hurt small businesses. Fox & Friends advanced several dubious claims to suggest that ending the Bush tax cuts for the wealthy would hurt "many small businesses" and hinder job growth. In fact, TPC has stated that only 2.5 percent of taxpayers who report business income on their individual tax returns would pay higher rates, and CBO has stated that extending tax cuts "does not create much incentive ... to hire more workers."
Despite evidence, Fox denied that aid to the poor is stimulative. Fox News hosts and contributors have dismissed estimates of food stamp programs' stimulative effect on the economy as "some strange multiplier effect study," "liberal math," and a "complicated economic multiplier theory." In fact, economists agree that food stamps are one of "the most effective ways to prime the economy's pump."
Fox absurdly claimed Reagan and Bush tax cuts caused "gigantic increase in revenues." Fox News' purported business expert Stuart Varney falsely claimed that tax cuts enacted under Presidents Reagan and George W. Bush caused "a gigantic increase in revenues to the federal treasury, reducing deficits. That's historically accurate." In fact, virtually no economist believes the evidence supports this notion.
Several Fox figures disputed fact of Obama tax cuts. Varney, as well as Fox News contributors Stephen Moore, Peter Roff, and S.E. Cupp all separately claimed or suggested that President Obama has not cut taxes, when in fact, the Recovery Act contained $288 billion in tax relief for individuals, families, and businesses.
I'd name names on a daily basis if I were in the Congress.
Mitch McConnell...this tax cut will save you $xx,xxx...how many jobs
will you create, and how will you create them?
And I'd say that every single day of the week...and I'd repeat it every single time I was in front of a microphone (no matter what the topic was).
Of course, Rove would drop 5 million dollars into my district and try to beat me with some GOP clown, and he probably would have a good chance at it.
They say it, and that makes it so, no matter how unfounded the assertion.
Hey, I got a novel idea, quit spending. I do.
Jobless benefits need to be available for those that need them, just pay for them.
In Oregon, according to the state employment office, there are 11000 jobs available. Yet, people aren't applying. hmmmm, what's that tell you. Either nobody's out of work, or their unemployment checks just keep showing up.
What are the qualifications for those jobs? Does everyone have the necessary skills? I'm not that sharp, but that was the first question that came to mind.
"Oh wait we don't, we only care about tax cuts for plutocrats."
~
The unemployment rate in Or has hovered between 10.5 and 10.7% for the past year or so. In a recent month there were large job declines: Gvt -3400; Mfg -2100; Constr -1000. They were partly offset by gains in other sectors.
Yes, it's a conundrum alright. There are always jobs available, and yet there are always unemployed people. How could that be? I just can't figure it out.......oh yeah, it's because at the same time new jobs are becoming available, old ones constantly being eliminated. I must be some kind of genious for figuring that out!
On that note, I must ask you, is "sharpshooter" another one of those sarcastic/ironic names like Onementalgiant/gallileonardo/fairliberal?
Line one: attack LIBRULS.
Line two: see how smearte I are! I have a super simplistic idea that is not really relevant.
Line three: make up some inane, non-proven statistics, then criticize the people that paid into unemployment for decades, and then are using it, while the enormous tax-break given, given unequal advantages, so called rich (monetarily overcompensated) people lay off others to give themselves higher personal profit at the expense of their country, companies and fellow human beings. AND ARE NOT HELPING BY EVEN SHOWING THEY ARE TRYING TO STOP THE BLEEDING!
Shows you are a real humanitarian!
The key to reducing the deficit is: GROWTH!
GROWTH: Growth comes from an expanding economy, which expands because the number of consumers making purchases, drives activity to the point where more hires are made to fill orders, and pay is increased to hold onto skilled/trained people.
This creates "disposable income" for the greatest number of people. Obviously the wealthy already have disposable assets, but, because their numbers are so small, and their tastes so high end, they do nothing to disperse wealth into the hands of the general public, where it's needed to drive growth. They can't or wont shop at your neighborhood stores or restaurants. Thus, if you and your neighbors don't have the disposable income to do so either, your neighborhoods economy goes under, and impacts their suppliers miles away.
Does anyone think that the tax cuts are helping stores in the Hamptons or Beverly Hills? They are not! The rich will continue to shop there at the same rate, regardless. So, the only thing left for tax cuts to do, is reduce gov't revenue and increase deficits. That, in turn means the gov't must, eventually borrow more money. When the gov't borrows, people lend to it at the best interest rates. Everybody else has to offer more interest than the gov't pays, to get any loans at all. Thus, if borrowed money is going to cost more, then businesses are reluctant to grow themselves, most especially when there are few customers coming in the front door, and spending less besides.
So then, tax cuts cause the economy to contract! Putting money in the hands of people most likely to spend it, causes the growth needed to reduce the deficit! In other words, deficits spent wisely pay themselves down, spent foolishly they cause mayhem.
Obwon
The average tax saving to someone making between 250k and 500k is $700. Hardly a bank buster if the Bush tax cuts are expired.
http://www.nytimes.com/2010/11/14/opinion/14rich.html?_r=2&pagewanted=2
You see, they want to maintain the illusion to their clients that they are not in dire straits. They need to do this for their creditor as well clients. Who is going award a $100,000 - $1,000,000 contract to a firm that cannot keep its own staff on board.
This company, it moving to a new location that will save them alot of money. They can no longer afford the current office. So they sent a press release announcing their move and citing they are a rapidly expanding firm that will be moving to this new location to accomodate this growth. It's all smoke and mirrors.
So add 30 jobs to your list of jobs that no one is applying for.
I'd like to isolate that sentence. I, and many others, have written something similar here, or at other sites, or said the same thing to people in real life, but we always end up adding more detail, as you did.
Maybe that's where the wingnuts get confused. It gets bigger than a bumper sticker, and we're working against ourselves.
Maybe we should just keep it simple. It's Reaganomics debunked in eight words.
Again;
Businesses don't hire people just to be nice.
When jobs don't get created, then people like Cavuto will say you need to make them permanent forever. The same crap they have been saying for years. We need that certainty. What we actually need is for demand to pick up and to bring some jobs back to America.
Stop using logic.
And what do you expect will happen when the tax increase is implemented. They will run right out and start hiring?
The private sector currently has 2 trillion in unused funds. How much more you figure they need to start hiring?
Hope this is of some help, I know it's complicated.
Obwon
this is just a small piece of a very well choreographed plan or you might say "business as usual for FOX NEWS"
Welp, I hope the weather's better than the logic there.
I, (Neil Cavuto), take you,tax cut mythology, to be my talking points, to have and to hold from this day forward, for better or for worse, for richer, for poorer, in sickness and in health, to love and to cherish; from this day forward until death of the middle class do us all in.
Do people actually tune in to watch a "host" yell over his "guest" and not let him get a word in edge wise?
Oh, wait a minute. We are talking about Faux News, are we.
I find it both confusing and amusing that such irrelevant dills are given airtime to push their worthless misinformation and lies.
tax cuts, by themselves, have zero impact on job growth, unless there is a substantial increase in demand to go with them. businesses hire based solely on demand, not tax rates. if they can produce enough to meet current demand, with the resources they have, it wouldn't make sense to acquire more, regardless of how low tax rates go.
this is econ 101.
Really, I give you four moons with a BS cluster.
Liberalism isn't an economic theory.
Trickle-down economic theory has been proven to be an utter failure.
You've got some learnin' to do yourself.
Tax cuts without spending cuts.
Wars not paid for.
A new "free" health benefit for medicare recipients.
How's that conservatism working for you?
Never change the narrative.
The 'news, must fit the narrative.
Both the right and the left agree that tax rates should not be raised on the bottom 98%...done deal.
The sticking point is the top 2%. Ok, here's the compromise. Conservatives agree to the rate hike on the top 2% for the next two years and then return to the present tax rate for the ensuing 2 years.
I find that these people are not as stupid as they are ignorant about the facts. Also, they do not read anything longer than two paragraphs. Media Matters needs to utilize the visual over the verbal in contesting faux emails.
If Fox can generate TV viewers with misinformation and twisted facts disputed by Media Matters and others, why is their no progressive TV programs to call out Fox and others. The Fox misinformation campaigns are follwed and believed by too many verbally lazy but visually oriented people.
A 30 minute daily TV program that hits back with the facts that hits back just as hard as Fox does. Words don't do it, but facts presented in a more visual than verbal format would.
Because they go broke. The only people that watch them are liberals and by looking at MMFA, most liberals watch FOX lol which don't leave many to watch MSNBC.
You can't do that kind of thing with truth. What might make it is, a show where they play tapes of the Faux & Fiends, while a blue ribbon panel make fun of them with the facts. That would be "Kung Fu" Journalism, where you use your opponents strength against him.
Obwon
Therefore, they will hire and invest if it pays them back when taxes are high, and they will hire and invest if it pays them back when taxes are low. Taxes aren't even in the discussion.
Stop it with your real-world examples.
Government spending is non-productive. It takes money out of the private sector where we use it to byu goods and services, and it wastes it on bureuacrats and politicians.
This absolutly bogus idea that the tax cuts will cost us $700 billion dollars is a complete liberal fallacy. It WILL mean the federal governemnt will have $700 billion less dollars. But that money does not belong to the federal government. That money belong to whoever earned it. The government spends to much money. If you don't have $700 billion then don't spend $700 billion. It is that simple. Hell you can get that money by shutting down just three or four of the smaller federal agencies. In light of recent events I'd start with the USDA.
ask the people receiving Social Security, Medicare and Medicade if it is nonproductive. Ask if Police and Fire services are unproductive. Ask if printing money is unproductive.The statement that GOVT.spending is unproductive one of the dumbest statements i have heard.
Market forces determine whether of not people are going to hire. Increasing the money people have gives them increased ability to hire people. Get the politicians grubby hands off the people's money and we will take care of ourselves.