Incomes drop most in 20 years

[mocgator]

As we all go furthur into debt with less savings. Hope and change baby!

http://www.bloomberg.com/news/2013-0...t-incomes.html


Consumer spending in the U.S. rose in January even as incomes dropped by the most in 20 years, showing households were weathering the payroll-tax increase by socking away less money in the bank.

Incomes slumped 3.6 percent, sending the saving rate down to the lowest level since November 2007.

Feroli added that “it’s probably going to be a tough couple months” ahead for consumer spending. “The downside is taxes and gas.”

The saving rate dropped to 2.4 percent from 6.4 percent. Disposable income, or the money left over after taxes, dropped 4 percent after adjusting for inflation, the biggest plunge since monthly records began in 1959.

[108]

wtf is with you with "hope and change"

the payroll tax cut was temporary help during the great recession, but im guessing, like the Bush Tax Cuts, you just wanted them to go forever even though they were going straight to the debt...

you want to reduce the debt, but criticize any measures taken to start doing that

damned if you do, damned if you don't

[PSGator66]

I love the agrument about tax cuts going on forever but why don't you mention the frivolous spending that is really the root of our nation's debt. It is like the workers/tax payers are the problem because we don't give enough to those who pay none.

[jimgata]

Please explain how tax increase will reduce the debt. Tax increases stall growth, the economy s shrinks, tax revenue decreases due to slow economy. Any monetary problem this country has could easily be solved by a growing economy and this administration seems to want to slow growth of the economy. WHY?
I an sure the left will bring Clinton's name up as an example, however the tech boom contributed heavily to the economy at that time, which by the way did collapse, before increasing later.

[fredsanford]

Originally Posted by jimgata

Please explain how tax increase will reduce the debt.

The tax increase that affected everyone was the removal of the temporary SS cut. Since this cut was coming out of SS, removing it reduces the debt SS causes or may cause.

[jimgata]

If removal of the ss tax cuts cause the economy to slow and gdp to be lower, the net result of removal of the ss tax cut will be little or nothing for tax revenue, emphazing the results of tax increases.

[gatordowneast]

To give money to someone, government must take money from someone else. Tax hikes, in any way, shape, form or description, do not grow anything.

Will be easy for the next POTUS to get our economy humming again. Just reverse every Obama regulation or policy and we will be kicking butt and taking names and some thumbsuckers, slackers and mooches will be kicked off these public assistance scams and have to get their asses to work. And the public assistance programs will then return to what they were intended for....A SAFETY NET...NOT A FRICKIN LIFESTYLE.

[ThePlayer]

Obama is leading America into 3rd world country status.

Of course, saying Obama 'leads' anything is an overreach.

[austingtr]

forward!

[mdgator05]

Originally Posted by jimgata

If removal of the ss tax cuts cause the economy to slow and gdp to be lower, the net result of removal of the ss tax cut will be little or nothing for tax revenue, emphazing the results of tax increases.

How very Keynesian of you. Keeping spending high and taxes low during periods of economic decline in order to spur growth. Sort of like the stimulus, which temporarily cut taxes and increased spending. Of course, as we have been growing, we have to start increasing taxes and lowering spending. Basic counter-cyclical macroeconomics.

[jimgata]

HUH? Nothing was even mentioned to increase spending. Where did that come from? The point was that increasing taxes does not necessarily add to revenue.

[GatorAbe7]

Originally Posted by mocgator

Feroli added that “it’s probably going to be a tough couple months” ahead for consumer spending. “The downside is taxes and gas.”

[/b]

Finally a projection that isn't ignoring the rising gas $$$ burden on family incomes. These "predictions," past and present, have neglected accounting for gas, and come every quarter Bernanke and the rest of the experts are left "surprised."

With the rising gas costs California can expect to be paying it's highest rates all-time, over $5 a gallon this summer. And in typical California fashion their Democrat super-majorities have this week increased the gas tax to the nations highest levels. 75-cents on the gallon is what I heard on the radio last night.

[mdgator05]

Originally Posted by jimgata

HUH? Nothing was even mentioned to increase spending. Where did that come from? The point was that increasing taxes does not necessarily add to revenue.

Which is the same argument for why you can't decrease spending during times of economic trouble in Keynesian economics.

[gatorman_07732]

Originally Posted by mdgator05

Which is the same argument for why you can't decrease spending during times of economic trouble in Keynesian economics.

Your completely out of your mind, if we could have spent our way into good times it would have already happened.

[mdgator05]

Originally Posted by gatorman_07732

Your completely out of your mind, if we could have spent our way into good times it would have already happened.

"If you think we can cut taxes into good times, it would have already happened."

In reality, we have structural issues with the labor market that nobody wants to even discuss. As long as we continue to try to have government intervene so heavily in the labor market through immigration laws while staying out of capital markets in the form of free trade, you will have firms engaging in skimming behavior, which will serve to push down wages and increase unemployment for semi-skilled and unskilled labor. And not everybody is suited to high-skilled labor, so we have to decide whether we want to push closer to free market equilibrium by getting rid of major government interventions in the labor market, such as immigration laws, re-nationalizing capital markets, or attempting to deal with the structural problems.

This structural issue has existed for years now. Each of the bubbles has papered over it, but that shouldn't be the goal.

[gatorman_07732]

Originally Posted by mdgator05

"If you think we can cut taxes into good times, it would have already happened."

In reality, we have structural issues with the labor market that nobody wants to even discuss. As long as we continue to try to have government intervene so heavily in the labor market through immigration laws while staying out of capital markets in the form of free trade, you will have firms engaging in skimming behavior, which will serve to push down wages and increase unemployment for semi-skilled and unskilled labor. And not everybody is suited to high-skilled labor, so we have to decide whether we want to push closer to free market equilibrium by getting rid of major government interventions in the labor market, such as immigration laws, re-nationalizing capital markets, or attempting to deal with the structural problems.

This structural issue has existed for years now. Each of the bubbles has papered over it, but that shouldn't be the goal.

Uh, no one person or group has had there taxes cut with the exception of that silly temporary payroll tax cut. In fact we have had a net tax increase.

[mdgator05]

Originally Posted by gatorman_07732

Uh, no one person or group has had there taxes cut with the exception of that silly temporary payroll tax cut. In fact we have had a net tax increase.

Yah with the exception of those tax cuts, nobody has had their taxes cut. We are talking about an economy stretching back to the 1990s. Are you really going to claim nobody has had their taxes cut since the 1990s?

[Matthanuf06]

Originally Posted by mdgator05

Which is the same argument for why you can't decrease spending during times of economic trouble in Keynesian economics.

The Keynesian model isn't meant for economies with such enormous debt loads though.

[gatorman_07732]

Originally Posted by mdgator05

Yah with the exception of those tax cuts, nobody has had their taxes cut. We are talking about an economy stretching back to the 1990s. Are you really going to claim nobody has had their taxes cut since the 1990s?

We all know Bush cut taxes

[mdgator05]

Originally Posted by gatorman_07732

We all know Bush cut taxes

And outside of a bubble in the mid-2000s, we have only really seen growth in corporate profits due to the structural issues. This growth is still continuing.

So if you think cutting taxes would be some sort of a magic elixir for the entire economy, without dealing with the structural problems, you would be wrong, as we have tried that.

Neither party wants to deal with the structural issues. Republicans don't want to deal with it because it involves them opening up immigration, admitting that they don't really want free markets, or designing programs with the recognition that allowing corporations to skim cheaper labor has negative consequences in order to mitigate the damage done to lower and mid income workers.

Democrats don't want to engage in policies that will naturally lead to lower unionization, don't want to restrict immigration in a draconian way, and are afraid of being seen as being too pro-government spending.

So on we go arguing on the margins and blaming the other party for a structural problem, while avoiding the problem and pretending that if only we cut taxes more, it wouldn't exist.