Extending the Bush Tax Cuts and Obama’s Deal

Here’s how a tax cut for those making piles and piles and piles of dough works for those of us who do not, due to various circumstances and life choices, make piles and piles of dough:

Step 1: Take out a shiny new Chinese Co credit card with an introductory low low teaser rate and a huge limit.
Step 2: Take a huge cash advance on that Chinese Co credit card.
Step 3: Find the richest person with the biggest house around.
Step 4: Give cash advance to said person.
Step 5: Watch said person light money on fire.
Step 6: Go pay interest payments on that Chinese Co credit card in perpetuity.

So much for all those campaigns on fiscal responsibility and ‘having to get our house in order.’ We get to extend the tax cuts and the estate tax over $5 million thing and some sort of payroll tax holiday and the unemployment insurance extension. I am for one of these (the unemployment insurance extension) which will, of course, sunset because it’s for people trapped in awful circumstances, and can only see the rest becoming permanent, which are for people who are not.

The payroll tax break is supposed to sunset in a year but really? Honestly? It will be extended forever and ever because we need to protect our middle class voters in a time of recession that will certainly still be going on and we cannot place burdens on our middle class when we are not. Isn’t the money coming out of Social Security? How does that get paid now? Magic fairy dust? And having the big tax cuts expire in an election year? What genius thought that up?

You know, I’m not big on pushing Mish, he’s a little bit on the crazy side, but I think here he is pretty much right. And on the other end of the spectrum, Krugman says pretty much the same thing.

They should have asked me. I would have recommended printing $800 billion in small bills, giving everyone in the US a marshmallow, having a huge bonfire, and inviting everyone. At least we would have gotten toasted marshmallows.

Over at Naked Capitalism there’s a nice post that has a chart with the stimulative effect of various spending programs. Food stamps, unemployment insurance, building stuff people use — all good stuff. Everything else? FABOOSH.

But hey. All those people getting more money can use it to invest in more Chinese businesses.

This crap is like the TSA arguments. Circular and stupid.  No way to win because no one with a spine will stand up and say “this crap has to stop.” Oh, by the way, we are wasting more government funds to put crappy video messages about scary scary brown people in Walmarts because, you know, that’s where terrorists from Pakistan go. Walmart.  Presumably to buy socks made by the Chinese.