Drug Tests for Welfare

Is this a real thing, conservatives calling for drug tests for those who get welfare benefits? I saw this remark everyone saw:

South Carolina Lt. Gov. Andre Bauer has compared those on government assistance to “stray animals,” saying that the reason you stop feeding animals is that “they breed.”

“My grandmother was not a highly educated woman, but she told me as a small child to quit feeding stray animals. You know why? Because they breed,” Bauer said during a speech advocating that the government take away assistance to those who do not pass drug tests.

And here’s a number someone just pointed out to me: there are 2 million fans of the group “Making Drug Tests required to Get Welfare” on facebook. Many are there to criticize it in the comments (and the comments are something), but probably not that many.

Since not seeing the sun in forever is getting me into a crap mood I’ll say this: I think I can support this idea if, and only if, it is also required that people who claim a mortgage interest tax deduction are also required to take a drug test.

Welfare

Kick some numbers: According to this research, “Tax Expenditures for Owner-Occupied Housing” by Poterba and Sinai (p. 8), the average homeowner saves $1,060 as a result of the mortgage interest deduction. (Different than how much they deduct, this is the actual savings.) If you want to subsidize homeownership because you think it has a halo effect, this is a terrible way to do it, since the benefits go to the top: For 25-35 year old homeowners with over $250,000 in income, the mortgage interest tax savings is $7,077. For household under the age of 50 with incomes between 125,000 and 250,000, the average tax savings from the mortgage interest deduction is roughly $3,600.

And richer people are far more likely to claim this deduction – more than 98% of homeowners with income in excess of $125,000 claim itemized deductions, compared with 23% of those making under $40,000.

Have I mentioned how poorly designed it is as a subsidy yet? As Ed Glaeser points out, this is an incentive to leverage up on housing, which is a major problem, it pushes up prices in places where housing is constrained, and gives a huge incentive to buy larger, single-family detached homes. All of this is lame.

How much does food stamps cost a taxpayer per person who receives it? Where can I get a good estimate? This gov site is giving me $124/month per person, so if two people are on food stamps for 6 months (or 1 person 1 year) it’s about $1,488, or less than half of what we give someone who makes $175,000/year to lever up when they buy a gigantic home. It also has the twin benefits of helping people suffering through double-digit unemployment, as well as the the highest “bank for the buck” rating as stimulus as estimate by Mark Zandi of Moody’s Economy.com. All of this is not lame.

Plus, there would be the interesting part of dragging 98% of homeowners who make over $125,000 and having them directed to pee in a cup by social workers, and giving them a first hand experience of the petty humiliations and disciplinary mechanisms of our current War on Drugs. That would certainly move the debate forward for those who would like to see solutions to issues surrounding drug use that don’t involve militarizing the police force or eating the Bill of Rights.

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79 Responses to Drug Tests for Welfare

  1. Not the Mike You're Looking For says:

    I’d believe it. Recipients of TANF (“welfare”) are already photographed and fingerprinted, and their personal information is put in a database that law enforcement can access without a warrant: http://ssrn.com/abstract=1401107

  2. Mike says:

    Holy fuck. I didn’t realize that at all. That paper is crazy.

  3. Edd says:

    Make all bankers and elected officials subject to the mandatory testing requirements, as a trial program. That way the program administrators could work out any bugs in the system on the smaller test group first.

  4. wbiz says:

    i make over a 100k/yr. and i have to take multiple drug tests. Most of the people i know and work make this much or more and they have to take drug tests. Why should someone get the money i worked for and not be subjected to the same drug tests. I do agree that lawmakers should be subjected to these tests. If it’s good enough for me why not everybody else?

    • mark says:

      Bizarre. why does income relate to drug tests ? I’ve seen many folks whose only ability is the ability to pass a piss test. If you don’t handle a gun, run a nuke or land airplanes, you don’t need drug tests. Everyone knows coke and such pass in three days, max. You catch only marijuana users with these tests.

      Most of the potheads I know do well over six figures….and the occasional toke appears not to have ruined their lives. I once went to a batchelor party with a lot of nuke workers…lots of coke, no weed.

      I’m sorry you are used to having to pee in a cup for your living, but that does not make it right.

  5. Mike says:

    wbiz,

    If you have to take multiple drug tests because of a labor contract you voluntarily entered into, that’s something you’ve chosen to do. I honestly think that’s a questionable search – would you let your employer enter your house and search it with dogs? – but whatever, if you are comfortable with that. I think it’s insane unless your employment really qualifies for it (and even then).

    Or is it the government making you? Because that’s what we are talking about here, and we have as individuals rights against these things.

    • yes for the law says:

      I have to say this. many of the welfare recipients (not all) entered into the program willingly. Whether it was a learned thing from ‘mom’ or whether they just started having children too soon in life to make their way in the world. It doesn’t matter. The point is, they *do* have a choice. Quit doing drugs, get their act together and get a job. People that do things like abuse the privileges are the main cause of the laws being put into effect. Lets take for instance ‘seat belts’ There wasn’t a law requiring their use 30yrs ago. But there is now, because too many people would get hurt or killed in accidents for the lack of their use. Text msging or talking on the cellphone is another good one. How many people have died because someone else was too busy talking or texting on their phone that they didnt’ see the person they hit? We don’t live in a perfect world, so sometimes the laws have to be changed to help us help ourselves.

  6. Cyndi says:

    I think the rampant abuse of the wellfare system is what causes people who have never been on wellfare to believe that most recipients are abusing the system. The most famous case that I know of was this one: http://www.h2indie.com/watch?uid=PR46JY8406PO but there are many others, perfectly capable of working, who live off of the system indefinitely. Those of us who work do have to take pre-employment drug tests and since we’re funding the wellfare system…why not drug tests for those recipients?

  7. Amy Googenspa says:

    You should get free drugs if you’re on welfare.

  8. Tony says:

    So like most liberals, you completely miss the point. This is about giving handouts to people who engage in self-destructive behavior. I really don’t care if people want to smoke crack until they die. Go nuts! But when they do drugs and then bill the taxpayers in hospitals for the maladies caused by drugs, that is not okay. And when they ask me for my hard earned money to buy food because they spent their McDonald’s wages on meth, I’m inclined to say “No.” The welfare system is designed to help people get back into a productive society. Crack smokers are not productive members of society and likely never will be. Welfare is about taking my money and giving it to someone else.

    People who make $175,000 are certainly productive members of society. Writing off the interest on a mortgage is not taking money from tax payers and giving it to someone else. It allows people to KEEP the money they’ve already earned. If you get money back on your income taxes, it means you are getting back the money the government stole from you the previous year. Their is nothing wrong with “the benefits going to the top” since many people who make $175,000+ a year are those who own small businesses. And when those people get to keep their money instead of the government stealing it, they can hire more people, offer better benefits, etc.

    • miles says:

      Absolutely Tony!

      A simple test to determine productivity (net income vs net production) could very well serve (that way we can kick all the crackheads and, y’know, shareholders out of the system) and since the most expensive drugs to deal with in terms of the hospital system are alcohol and nicotine, you should test for those too! And fat people! And people with mental health problems! Then we could really start making some serious inroads into welfare reform, and make sure that you only help the people who really can get back on their feet on their own.

      After all, people really only deserve to live if they are productive and not a burden on the health system (sorry, what health system.. this is the US isn’t it?).

      ps: really? liberals? (http://en.wikipedia.org/wiki/Liberalism)

      • Tony says:

        Whoops, looks like you linked to the wrong definition of a liberal (http://en.wikipedia.org/wiki/Left-wing_politics). Mistakes happen to all of us.

        Since you start with the false assumption that I am cold and heartless, I’ll go through and point out the correct responses.

        Alcohol & Tobacco: Like I said before, I don’t care if you drink yourself to death or smoke yourself into lung cancer. But when you get liver disease and emphysema, I don’t want the bill as a taxpayer. I would be in favor of legalizing every drug known to man and providing them dirt cheap to anyone who wants it. Problem is, we have a welfare system that would support those kind of idiots. Do you really want to support people with YOUR money who destroy themselves?

        Fat people: Same problem, different cause. If you eat until your 1000 lbs, don’t call the fire department to bail you out. Same fix: don’t be stupid with your life.

        Mentally infirm: This IS where the welfare system is meant to be applied in all aspects. People who CAN NOT SUPPORT THEIR OWN EXISTENCE should be cared for by society. People who are born with syndromes and other disorders SHOULD be cared for, which would also include people with severe injuries. People who CAN work should work so they can eat and better themselves.

        People deserve to live no matter what. If they want to fill their veins with poison, go ahead! JUST DON’T SEND ME THE BILL! And I wasn’t referring to a burden on the health system. I was referring to a burden on TAXPAYERS.

        There are VERY FEW people who can’t get back on their feet and work. It’s not very hard to offset your own existence. The problem is, we give people money when they aren’t working. Sometimes it’s because of layoffs. Sometimes they are just lazy. We shouldn’t just GIVE them money. They should do simple labor to earn the money. Most people enjoy being rewarded for productivity. Doesn’t have to be fancy work. Could be picking up trash along the road, building roads, municipal work, etc. Maybe they learn some new trades that help them reclaim jobs in the private sector.

        If the government is going to be reaching in my back pocket, I want it to pay for productive people who are able to be productive. Not some couch potatoes that watch Jerry Springer.

      • miles says:

        Social liberalism is an entirely different beast… but hey, i guess we all make mistakes and I know you americans sometimes have funny views on how to spell and measure and y’know, what words mean.
        Well, I didn’t really think you were a heartless bastard, just thoughtless. Now I see that you have thought all about it, well…

  9. Mike says:

    Cyndi:

    It’s too soon to bring up the ODB. May he rest in peace. And may he be in a place where he won’t get burnt with gonorrhea anymore.

    Also there’s that Bill of Rights thing.

    Everyone:

    Wait! I’m reading things like this: “In FY08, the MID [mortgage interest deduction] cost the U.S. Treasury $67 billion.” And that’s a low estimate – I’m reading some higher ones too. Food stamps (in this emergency!) are $53 billion. I assumed we spent more on food stamps overall. Wow. I’ll look into this tonight and see if I can get a better estimate, but wow we really, really do welfare up housing through this mechanism.

    • Nick Brown says:

      Mike,

      The big difference is the MID are funds RETURNING to the tax payer as a reward of being productive in society. As a small business owner, this gives me flexability to grow my business and hire more people to take off of welfare.

      The Welfare dollars just fade out in to the ether. Listen, if welfare was working none of us would be having this conversation. It clearly needs reform and to get free stuff, drug testing sounds fair. I’d say no drug testing should be required for mentally disabled or the people welfare was designed for that can’t care for themselves. Heck, I’d like to see those people covered by a completely different program alltogether.

      • Anonymous says:

        I’m sure you hire tons of people straight off of welfare – all the well-educated white ones, anyways.

      • Not the Mike You're Looking For says:

        If the deduction was a “reward” for “being productive in society,” why wouldn’t the government take it off of your income taxes? Or the value of the equity you hold in your home? Why use it to encourage people to lever up on their homes?

        And no, the deduction does not allow you to hire more people to take off welfare. If you’re at all a savvy businessperson, the only reason you’ll hire someone is if her contribution yields more revenue than what you pay her in salary (and taxes). Period. You’re not going to hire someone at a loss because all of a sudden you have more money in your pocket due to the MID and feel like sharing the wealth.

        Also, it’s not true that “if welfare were working we wouldn’t be having this conversation.” Statements by you, Tony, Mike H., and Dwight indicate to me that you have never met a person on welfare nor looked at any numbers on the subject. You’re basing your assertions on rumor and imagination, and what little information you do have is a decade old at the very least.

        I find it ironic that the “productive” members of society raising the most complaints are a farmer and a real estate agent–both of whose livelihoods are extensively subsidized by federal government policy. If we could get a banker here it would be a perfect trifecta.

  10. Mike H. says:

    You’ve missed the point entirely. The purpose of welfare is to help people get back on their feet and become once again, a contributing member of society. Instead some lazy bastards just sit back and do drugs instead of doing things like using the money to take better care of themselves or their children. I’ll gladly pee in a cup when filing my taxes or getting my paycheck if that’s what it will take to make some deadbeat do it too.

    • Jonathan TE says:

      Mike H. and Tony — even assuming that welfare exists _only_ to help people get back on their feet, why then do other, and larger, welfare programs exist that are skewed to benefit those already on their feet, like the mortgage deduction discussed in the blog post? And regardless of the footedness of the welfare recipient, the principle of fungibility remains the same. Just as food stamps may be fungible for the poor, enabling them to consume more drugs than they would otherwise, so is the mortgage deduction for the rich, enabling them to have thousands of dollars more in disposable income to spend on pot, coke, and bogus visits to the psychiatrist to get prescriptions for Valium. So Mike R’s question still stands unanswered: what justifies different standards for how taxpayer money is spent on the poorer vs. on the richer?

      (This makes for a good opportunity for me to plug a terrific book that, I think, is now out of print: Marilynne Robinson’s “Mother Country.” Among many other things, she shows how the centuries-long attempt in the UK to constantly reform the welfare system so as to weed out the “undeserving” poor from the “deserving” poor succeeded in only one thing–always failing at its purported goal and in fact consistently making things worse including for those we would all judge “most deserving.” It’s absolutely fascinating and doubles in value since it’s written in Robinson’s ["Housekeeping" ; "Gilead" ; "Home"] astonishingly powerful prose.)

      • Nick Brown says:

        Jonathan,
        People taking the mortgage deduction are still paying a huge chunk of taxes in to the system. Welfare people do not pay any taxes.

        Welfare is a program that just TAKES from the taxpayer with no give. Mortgage deductions isn’t at all similar – It’s a REWARD program for being productive and contributing to the stability of our housing economy. Giving funds back to the fiscally responsible as they know they’re more likely to responsibly redistribute (not always a guarantee, but definitely more likely than the person receiving welfare).

        Trust me, I pay TONS of taxes and contribute my fair share.

        And in retort to the terrific book you plug, I’m sure it’s good, but I get the sense you’re saying “quit trying to fix welfare, because it makes it worse.” My response to that is, I’m sure the UK is making mistakes as will always be the case, but I applaude them for attempting to fix something broken. It’s sad they’ve muddled it more than fixed it, but at least they’re not just throwing up their hands and saying “well, it’s broke, deal with it.”

  11. Dwight says:

    Mike,

    wbiz doesn’t have to take the drug tests. My guess is he chooses to do so in order to be gainfully employed. If a company wants to make that a requirement for employment and one wants to work for the company, then they take the tests. I think more companies should do that. It helps the bottom line in many ways and in some industries it ensure people operating dangerous equipment are in their right mind when doing so.

    That said, this article is just a left-wing view and is so full of holes it is pathetic. Yes, someone making a lot of money gets a bigger tax break than someone who doesn’t. They also pay more in property taxes.

    “And richer people are far more likely to claim this deduction – more than 98% of homeowners with income in excess of $125,000 claim itemized deductions, compared with 23% of those making under $40,000.”

    Well duh! If you are only making $40,000 per year you haven’t paid that much in taxes to begin with. You probably also don’t have the income to donate to charitable organizations to make it worth the effort to itemize.

    “Have I mentioned how poorly designed it is as a subsidy yet?”

    The tax break isn’t a “subsidy.” How can you subsidize the people that pay the taxes? The wealthy people in this country are the ones that pay the majority of the taxes. They also employ a lot of people. In general people don’t itemize just because of the tax deduction on a mortgage (the smart, wealthy ones don’t even get the tax break because they don’t carry a mortgage). They itemize because of the donations they make and the expenses they occur (employing other people).

  12. e rob says:

    I have to agree with several of the posts on here. I have had to take more drug tests than I can remember working as a government employee, civilian contractor, and military service member. I have always paid my taxes and have been honest but still have had to endure this “travesty” as it is portrayed here. What is wrong with making someone on welfare do it? Plenty of us have had to take drug tests just as Cyndi mentioned. We have taken these drug tests as an agreement to get and maintain employment and that employment has been used to pay for these programs that so many have been abusing. As I always say, think logically before thinking liberally.

  13. Carissa says:

    First thing, I find it rather disturbing that all people on welfare are being described as “stray animals” who need to quit being fed. These programs are in place to help people get back on their feet if they need it and to help them get back into the threads of society, and their are many who are suffering hardships in this time of recession. Second, people receiving welfare are already subject to heavy monitoring, as Not the Mike your looking for said, additionally to what he stated most MUST agree to let social workers or police come and search their homes at will, without warrant. There is a difference to willfully submitting to something, and having it be your only option, to which you have to accept all it entails. People may agree to drug tests for employment, probably picture ids as well, possibly fingerprinting. I’m sure though that bosses do not visit their homes and look through their things, and I’m sure police still need warrants to search their homes. Requiring more tests would just further trample these peoples rights, and cost more of those taxpayer dollars, possibly to little additional results.

    • Sam says:

      We are not saying that those who are working to get back on their feet are like stray animals but rather those that abuse the system. I do not mind feeding workhorses, service dogs, or even domestic pets because these all contribute something useful to those who are paying for the bill. I am not willing to feed stray raccoons that dig through my trash. they provide no benefit to me or my environment.
      As to your second point: please remember that the testing and scrutiny that those on welfare have to “tolerate” is no different than the scrutiny I have to undergo to maintain my employment. I have agreed to uphold certain standards in exchange for a predetermined amount of money. People on welfare are doing exactly the same thing except that they are returning nothing of use to those who are paying them. If they are unhappy with the arrangement they can opt out at any time. Please do not say that they are being forced into this indignation. those that truly are forced into this situation will not mind the additional precautions. The only people that will have a hard time with this are those who are abusing the system. Period.

    • Nick Brown says:

      Baloney,
      I dated a girl in college 10 years ago and her sister had been on welfare for 4 years and was a total slug. She could have worked but decided welfare was the route she wanted to go for her future.

      Last month I ran in to my ex and asked her how her sister was. She was still on welfare. That’s 14 years of welfare. (this is in Colorado if you’re wondering).

      So when you say they’re subject to heavy monitoring, I find that VERY hard to believe.

      So if I agree to drug tests to get money from my job, what’s different from welfare recipients agreeing to drug tests to get money for their “job.” They don’t have to take welfare.

  14. Carissa says:

    And Here! Here! to mark :)

  15. Lula says:

    Welfare “reform” limits the total time one may spend on welfare to 5 years (so yr screwed if yr a single parent who is trying to get through college but maybe had to use a couple years of it as a teen parent).

    There is no question that it is better for the economy to spend money on people who use the money to immediately buy necessities (foodstamps) than to spend money subsidizing those better off who may not even spend it for several more years.

    • Tony says:

      “There is no question that it is better for the economy to spend money on people who use the money to immediately buy necessities (foodstamps) than to spend money subsidizing those better off who may not even spend it for several more years.”

      You might want to check with your economics teacher next time. Food does not stimulate an economy. Everyone must eat, everyone buys food. The best thing for the economy is to buy durable goods (cars, appliances, furniture, etc.). Durable goods are made in factories (hopefully you buy durable goods made in AMERICAN factories). Factories employ large numbers of people with good paying jobs. The most likely people to buy durable goods are those who have discretionary income, such as middle class families and up. Not welfare recipients who are lucky to own a washing machine.

      • sraffa says:

        As an economics teacher, you are wrong. Food does stimulate an economy, it’s expenditure. Everyone eats, but food stamps may allow people to buy higher quality foods, like vegetables. More expenditure generally means more jobs.

        Everyone should eat- since you’re whining about food stamps, you don’t seem that committed to everyone eating.

        Durable goods purchases are great too, so I assume you support cash for clunkers, right? Or do you have an alternative plan to stimulate durable purchases.

      • Tony says:

        So if I call myself an “economics professor” will that trump you just being a “teacher”? How exactly does people buying more vegetables produce more jobs? Is the farmer going to say to himself, “Wow the government is increasing money on food stamps, I better plant more celery!” And if this is the case (it’s not) then would the farmer hire more employees (celery-pickers) to harvest his bumper crop? Hmmm….I wonder what he pays those celery pickers? Since your a “teacher”, he probably hires LEGAL citizens and pays them a good wage with benefits right? See the problem is that field labor is one of the lowest paid jobs in America, usually done by illegal immigrants.

        Hmm, you’ll have to go back and point out in my comments where I said “not everyone should eat” cause I just can’t find it. Otherwise you’re just putting words in my mouth. I’m whining about people who receive tax dollars from me who lead self-destructive lifestyles.

        “For even when we were with you, this we commanded you, that IF ANY WOULD NOT WORK, NEITHER SHOULD HE EAT.” – 2 Thessalonians 3:10

        Why yes! I have a great plan to stimulate durable goods! CUT TAXES! All taxes across the board. It’s amazing what people will do when they GET TO KEEP MORE OF THE MONEY THEY’VE EARNED. They might actually spend it!

      • Jonathan TE says:

        Tony, it’s been a while since I taught any economics (I never did manage to profess it), but food stamps can stimulate the economy by virtue of freeing up other resources held by the recipients. If I have any money at all, when push comes to shove I’ll probably spend it on food if that’s all I have enough for. So as a first approximation, you would seem to be right. However, by enabling me to acquire food without spending my meager pocket change, I am now able to spend that remaining cash on something else that _is_ more likely to be stimulative in the way you describe. Those things don’t have to be durable goods–nondurable goods also get made in factories, and service providers need customers too. So what $100 of food stamps can do is maintain that amount of spending on food while freeing up $100 of cash that would have been spent on food but now instead will be spent on something else. And that redirected spending can be stimulative.

      • Jonathan TE says:

        PS: Tony, food stamps can directly stimulate the agricultural economy by increasing demand. As reported in NYT

        “The number of Americans who lived in households that lacked consistent access to adequate food soared last year, to 49 million . . . About a third of these struggling households had what the researchers called “very low food security,” meaning lack of money forced members to skip meals, cut portions or otherwise forgo food at some point in the year.” http://www.nytimes.com/2009/11/17/us/17hunger.html

        So even if everyone _must_ eat, that doesn’t mean that everyone _is_ eating. And while there are few to no people in the US who eat absolutely nothing and wither away from pure starvation, there are people eating quantitatively less (not to mention qualitatively less) than they would if they received food support. That food support means more food will be consumed, means more food gets sold from the grocery stores, means more food demanded of farmers.

        Also, there’s shifting that can happen. If I don’t have enough money, I’ll just drink tap water. If I then get food support, I might buy milk or juice, stimulating the economy via an increased flow of money to and through dairy and fruit farmers.

  16. Dwight says:

    Given the current state of the economy, I could agree that there is a large majority currently on some form of welfare that will be off of it within the next year. These are the people that have lost jobs and can’t find work right now.

    My issue is with the people that live on welfare and use it as a crutch to get through life as a whole, not as a hand to help them through a rough patch. You can jump up and down and tell me that people don’t do that all you want but your only telling a lie.

    Most seem to think it is OK for a company to require you to take a drug test to collect a paycheck. Why is it not OK to make someone take that same test to collect a welfare check?

    If you have a job and are taking care of yourself, do whatever you want as long as you don’t steal or hurt someone else. If I have to take money from my family to help you, why should I not be allowed to dictate how that money is spent? It’s welfare not a gift.

    • sraffa says:

      If I have to take money from my family to subsidize your mortgage debt, why should I not be able to dictate how that money is spent?

  17. sraffa says:

    “My issue is with the people that live on welfare and use it as a crutch to get through life as a whole, not as a hand to help them through a rough patch. You can jump up and down and tell me that people don’t do that all you want but your only telling a lie.”

    People don’t do it all that much. TANF is of very limited duration, and more people on welfare are children. Get a job, kids!

    If I’m only telling a lie, back up your allegation with data. Mike did.

  18. godlizard says:

    There are good reasons we have protections against random search and seizure. The biggest argument against it is false positives – eat a couple of poppyseed bagels and you’re positive for heroin. And yes, I used to think that was a load of hooey until I saw the science, but that’s beside the point.

    The point is, if you are living in abject poverty on welfare, and you pick up a dozen bagels at the bakery outlet store (on $124/mo/person, eating cheap is a priority), and you subsequently test positive, you don’t have the resources a homeowner has as far as fighting your case. All the homeowner loses is a few thousand out of many thousands, it might sting, but it’s not the end of the world.

    For a single mother who escaped an abusive marriage and is struggling to get by, it’s a disaster she and her children might never recover from.

    Unless they can guarantee 100% accuracy, with no false positives, I’d have to say I’m categorically opposed to drug testing for those among us who are least able to defend themselves against an accusation. Not even in trade for taking away a few homeowner exemptions — it’s just not a fair situation.

    You can say it’s only a small fraction of tests which are inaccurate, but each one is a tragedy in and of itself.

    Here in California, people with drug convictions are barred from receiving benefits, and there is a lifetime 5 year limit, so there’s no such thing as people “using it to get through life as a whole”, and there are already plenty of people with a past conviction who may be clean today yet still not be able to receive benefits. This isn’t the same welfare system Reagan personified with the “Welfare Queen” example back in the 80’s.

    And let’s not forget the influence of the extremely lucrative drug testing industry, who uses the same “if you’re not doing anything wrong you have nothing to hide” fallacy as every other industry that campaigns against basic civil rights.

    Bottom line, I’m not willing to put a few innocent families out on the streets for this. If someone’s on welfare and doing drugs, they’re not affording it with welfare, they’re doing crime too, and are very likely to get caught, as they are not exactly in the elite Goldman-Sachs league of criminal.

    Speaking of Wall Street, aren’t we focusing on the exact wrong end of the crime spectrum here? Why not go after the folks receiving millions in welfare, not those receiving thousands? You’d have to catch thousands upon thousanes of welfare folks to make up for one Wall Street crook, so logically, going after Wall Street is just more efficient.

  19. Stinky says:

    Drug tests, yes.
    In Mexico they seem so much more progressive about welfare than they are in the US. Apparently, to get the money mothers have to take parenting classes, they have to take classes to learn to feed their kids healthy foods, they have to make sure their kids don’t miss school. The goal: educated skinny poor kids who are equipped to get a job or pursue a higher degree. Contrast that to America’s goal of creating leeches.

  20. Dwight says:

    sraffa,

    You aren’t taking money from your wallet to subsidize ANYBODY’S mortgage you stupid little dolt Yes, I went there because your ignorant statement deserved it. It is a tax DEDUCTION. That means it is the homeowner’s money to begin with and they just get to keep a little more of it instead of sending it to Washington so Pelosi can keep her personal military plane on standby.

    TANF is one small portion of the welfare system as a whole. Just go to any inner city and most rural areas and you can see the facts for yourself. Lazy bums waiting on the government check. unwed pregnant women smoking cigarettes. Worthless idiots hanging out waiting for the disability check. They can lift a 40 ounce and a joint but the can’t lift a loaf of bread and bag groceries at the grocery store.

    • Not the Mike You're Looking For says:

      Dwight (and Tony), the tax break is a subsidy. It’s because it’s selective. Consider the following: Two people pay income taxes. In one scenario, the government says that if you take out a mortgage, it will pay part of the interest. In the other, the government says that if you take out a mortgage, you can deduct the interest on your taxes. Is there a difference? The government is redistributing money from people who don’t get mortgages to people who do. That’s a subsidy.

      Also, Tony, food stamps are stimulative. “Is the farmer going to say to himself, ‘Wow the government is increasing money on food stamps, I better plant more celery!'” Yes! “And if this is the case (it’s not) then would the farmer hire more employees (celery-pickers) to harvest his bumper crop?” Yes!

      It’s called an increase in demand. The government has put purchasing power in the hands of people who previously could not afford to buy celery. They now buy celery. The farmer has to meet that demand. He hires workers who were previously idle. You may not like the type of job that has been created, but the food stamps have provided a stimulus.

      I suppose you could say that people only eat so much celery. Fair enough. Then food stamps have freed up some of their recipients’ incomes from grocery expenditures to spend on other things. Presuming that they’re not able to save that money (which I’m sure you’ll agree with), they spend it–for instance, on a cooking pot. The demand for cooking pots has increased by 1. Somebody has to make that pot. That’s a stimulus.

      Last, I find the right’s conflations of liberalism with Stalinism, fascism, etc., to be tiresome. (I’m inferring this from Tony’s link, but mostly I’m saying this based upon stuff I’ve heard elsewhere.) Do you guys actually believe this, or do you just think that it gives your arguments extra punch?

      • Tony says:

        Your view of farming is shortsighted. I am a farmer. I grow corn, soybeans, and raise cattle, and sheep. I have X amount of acres to farm. I plant every acre available to me. Grain prices (as well as vegetable prices) are all closely tied together. It is very rare for one commodity to outpace another. You would have to see a spike in one commodity alone for it to affect supply. They farmers are going to plant the same amount every year. Good years mean a little more money in their pockets. Bumper crops spur more hiring, not prices. The cycles are so long to grow produce and grains that you can’t plan for more workers and higher prices.

        Let me clarify: spending money on food does not stimulate an economy. Because most food is produced by farmers, the problems above negate any real benefits. You can say that buying small items such as cooking pots stimulates the economy. Except it’s not the American economy your stimulating. The people who use their food stamps at Walmart and buy their cooking pot from Walmart are stimulating the Chinese economy, not ours. Purchasing American goods made in American factories will stimulate the American economy.

    • Lisa says:

      I debated for quite awhile on whether to comment or not since you are obviously quite content in your ignorance and stereotypes.

      Do you know who the average welfare recipient is? I do (I did a study on this about 3 years ago). She’s not a black inner-city woman with 5 kids. The average (mean and median – do you know what those mean?) welfare recipient is white, has two children, and does not live in bigger cities, was married but is now divorced (most often because of abuse or abandonment).

      Living off welfare is not the high-life you claim it to be. The income threshold to actually receive “Cash assistance” is so low that anyone qualifying must be in a situation where they either live in gov’t housing, have no car (which makes working difficult), and literally are scraping the bottom of the barrel in terms of standard of living -or- must have some less-than-legal way to supplement income. How the hell do I know? I was that person and the ONLY reason I am not there still is because I had the good fortune to have a rich relative who helped my get through college.

      When I was a freshman working towards my BA (in economics – now have MA) I lost the shitty, low-paying job I was using to buy food for my children. The wonderful people at DHS told me that, in order to keep receiving food assistance and medicaid for my children, I would have to drop out of school and get a full-time, minimum wage job. WTF? If I didn’t have a grandpa to save me I’d be like all the other people who get trapped into the poverty system – a system that is designed to punish people for misfortune and prevent them from ever doing better. It’s people like YOU Dwight (and Tony – also in this thread) who, out of ignorant arrogance, have made it that way. Welfare is a safety net with a ladder, only people like you have taken out all of the lower rungs, making it useless, forcing all caught in the safety net to stay there. It’s the illusion of help with a delusion of hope. I think you like having a scapegoat to blame for all of society’s woes when the real villains are people like you. One can only hope that one day you, too, lose your job and are forced to apply for the demoralizing and humiliating programs you speak against so that you, too, can understand what it feels like to be treated as less-than human and obviously stupid (well, not too much of a stretch for you there).

      Some advice, when the only facts you know about a subject are those which you made up, do the world a favor and STFU (and please don’t breed).

      • godlizard says:

        Lisa, on behalf from someone who has been following this thread and been appalled by the ignorance, hatred, and posturing from those who listened to Reagan’s apocryphal “Welfare Queen” story (or something equally ridiculous) and stopped listening immediately thereafter — thank you.

        There may once have been a reasonable safety net in place, but that has been almost completely eliminated. Stupid things like, if a single mother with two children gets on public assistance and gets the job she’s required to, they’ll pay her child care for a limited amount of time – child care that probably costs most of what a person earning minimum wage takes home – and when that’s gone, she finds herself in an unsustainable position. That’s just one of many examples of the nearly impossible hoops one is presented with in order to get any assistance at all.

        For as much as the right wing yaps about family values, they certainly have zero compassion for families who have suffered misfortune.

      • sraffa says:

        Lisa- I appreciate your perspective. The racialization of the “welfare queen” thing is really troubling. I think this image from Reagan of an urban black woman living a high life of the public dime is the biggest myth in American public discourse- and one of the ugliest and most damaging. These people just don’t exist.

        Godlizard- You’re exactly right. Eespecially when you consider that most recipients of welfare are *children*. Even if the mother was not trying to get a job (which is the vast minority of cases), should a child be punished for that? Are the kids supposed to get a job? It’s really a blame the innocent policy.

  21. Dwight says:

    I just opened a rather polite email from Mike, it may end up posting here, I don’t know.

    He pointed out some people that refer to the tax deduction as a subsidy and suggested I take a look at them. I’ve taken a quick look and will look more later, but I still stand behind my belief that the tax deduction is not a subsidy. I get tax deductions for things like my mortgage, my kids, my non-profit donations, etc. I didn’t have a kid thinking “tax break” and I don’t donate my time, money or services thinking “tax break.”

    In order for me to believe that it is a subsidy, I would have to believe that the government has a fundamental right to take as much money away from me that they want. My belief is that I earn my paycheck and that the government should get only what it needs to protect this country, provide basic safety services for us and maintain/improve the infrastructure that is available to all citizens. Beyond that, the government is practicing no more than thievery.

    As far as the welfare programs go, in my opinion some of that would fall into protecting our country and safety services. We have a large non-profit sector in this country that should be the ones helping people improve themselves. If you wanted to get Biblical, the church should be the one supporting those less fortunate. Personally, I get frustrated with organized religions because I feel they do not do enough.

    I sell real estate for a living. Very few people take into consideration the tax deduction of a mortgage payment when deciding to buy a house. They take into consideration property taxes when deciding where to live. Those that earn enough to consider the tax deduction when buying a home, typically realize it doesn’t make economical sense to buy a home for the deduction. You pay more in interest than you get in the deduction.

    I’m not a fan of the tax credit stimulus money to buy a home. That is a subsidy for many.

    Mike also pointed out there is no need for name calling, I agree there is no reason for it and I probably should apologize, but I did say it and I do still feel that way. I don’t normally stoop to that level though.

    • Not the Mike You're Looking For says:

      You can read more in the post I did above, but I’m posting here because real estate is an even better example. What’s the difference between the government giving you $8,000 and allowing you to deduct $8,000 from your taxes?

      • Tony says:

        Pretty easy: The $8000 deduction is you keeping the money YOU’VE ALREADY EARNED. The government giving you $8000 is money YOU DID NOT EARN.

    • Tony says:

      Don’t be swayed Dwight! You were right to begin with. Subsidies prop up failing industries, or industries that are too young to support themselves. Words have meaning. Go get a dictionary Mike if you need one. I’m gonna trust it before I trust journalist to tell me what words mean.

      From Merriam-Webster online: definition c : “a grant by a government to a private person or company to assist an enterprise deemed advantageous to the public”

      There you go. It is a GRANT (payment) by the government. DEDUCTIONS are not payments from the government. They are EXEMPTIONS that let you keep the money you have earned.

      I also got a similar email as a posted comment here from Mike in my notifications but I don’t see it on the board. Maybe he deleted it when he realized he was wrong. Anyway, he quoted the WSJ:

      “The mortgage-interest deduction for owner-occupied homes is estimated to cost the government $100 billion this year, making it the largest government subsidy for housing and one of the most expensive tax deductions.”

      It will COST the government $100 billion because that is the amount of money that we as TAXPAYERS get to keep them from stealing from us! If you’re going to say all tax deductions are subsidies, then you must start with the assumption that the government is entitled to my entire paycheck and that they are giving some of it back for me to keep.

    • Jonathan TE says:

      Dwight, it may well be true that you don’t choose to have a child so that you can take advantage of the child tax credit. However, it is certainly true that many people do choose _not_ to have a child (or another child) because they feel that they just won’t be able to afford it. Some people will be at a borderline level of their finances. The tax credit can give them the confidence boost they need to choose to have the child.

      You also say people don’t think about the mortgage tax deduction when thinking about buying a house. Why don’t they? Wouldnt’ you think about the difference between a mortgage with a 5% fixed rate and a 6% fixed rate? If you could get the 5% rate, that might be the inducement you need to move from renting to owning, or it might give you the boost you need to buy a larger house, or a house in more expensive neighborhood, rather than the smaller, less-expensive neighborhood hosue. Well, that’s what the mortgage deduction does. It reduces the cost of your mortgage just like having a percentage point shaved off your mortgage.

      Not the Mike tried one analogy. Let me try another. Twin brothers work side by side at the same company, both engineers doing the same work, making the same salary. They have the same nominal income tax bill. They live in identical neighboring houses. But brother A bought his house and so claims a mortgage tax deduction. Brother B rents his house and gets no such deduction. The government has chosen, through a tax provision, to relatively subsidize one brother instead of the other. Brother A did nothing to “earn” or deserve this discounted tax as compared to brother B. The issue here has nothing to do with what the government does with the money but on the discriminatory way in which it collects the money. Even a limited libertarian government collecting the minimum in taxes would have no justification–other than some theory of welfare for home owners over renters*–to have a tax deduction for the owner.

      * And such theories do exist. Many people think it’s a public good to have lots of home owners, just as many people think it’s a public good to ensure everyone adequate food, even unemployed drug addicts. But even if they’re right, the point is clear: the mortage deduction is a kind of welfare.

  22. Drano says:

    So…how about ending both welfare -AND- silly tax write-offs? This is a ridiculous false choice–suggesting we can either pay interest subsidies -OR- welfare.

    Both are nonproductive, imho. Taxes can only be fair when the wealthy can’t escape their tax obligations and the poor aren’t given the bulk of tax revenue via non-discretionary entitlements.

  23. Dwight says:

    First off, the email Mike sent me was polite, I didn’t catch a link in it but I think it was more of a moderator email to let me know I didn’t need to resort to name calling. I’m new to this site, to be honest I haven’t ventured past this page yet. The link to this post was given to me from a pi$$ing contest on another site.

    As far as the tax credits and tax deductions. Tax deductions should not be referred to as subsidies. The left likes to do that because people who want handouts, like to feel they are getting one. If I get a tax deduction, the government is not giving me any money. They are letting me keep a little more of my money. Tax credits are where your tax liabilty is reduced dollar for dollar for something specific. It used to be done at tax time, but with the greediness of our politicians and general citizens it has evolved into almost instant cash. Sometimes you can even get the cash if you still have a tax liabilty.

    The housing tax credit is bloated and only necessary because the government forced the banks to make bad loans when Cuomo was headed out the door of HUD (at the end of the Clinton era). Had Cuomo let the private sector continue doing what it was doing (making sub-prime loans) without interference, I have no doubt the housing crash would have happened faster and been a lot smaller. Instead it was prolonged and created a domino effect that crippled other sectors as well.

    I’m going to give all of you a challenge that are bashing the tax deduction for owning a home. If you own a home, or make enough to make it worthwhile to take deductions when it is time to do your taxes, skip the itemization and deductions. Do the short form and feel good about giving the government more of your money. If you don’t feel good after that and still need to give away money, let me know. You can give me some of it and maybe I can quit my second job and my wife won’t have to teach summer school.

  24. godlizard says:

    Imagine two small businesses. Business A sells tractors, and Business B sells cars. Both businesses have the same amount of revenue, the same number of employees, and earn the same amount of profit, but Business A is given a tax credit because they sell tractors. In this scenario, Business A is considered to be receiving a government subsidy to sell tractors, presumably to encourage that sort of economic activity.

    So if two individuals have the same income and pay the same amount per month for housing, but one individual gets to deduct part of that housing cost from his income, he is receiving a subsidy from the government, presumably to encourage that sort of economic activity.

    In both scenarios, we have a significant difference in the amount of tax paid by two very similar entities with the same income, which results in a significant difference in their bottom line. In both scenarios, the sole reason for this disparity is that the government is the effective tax rate, which is based on arbitrary criteria set by the government.

    If two entities earn the same amount and spend the same amount on the same type of expense, but one receives a tax break for a specific variation of that expense, they are getting a subsidy. It doesn’t matter that it was their money and they’re just giving less to the government, giving less to the government leaves you with more money.

    Unless someone would care to argue that someone paying $2,000/month rent deserves to pay more taxes than someone who owes more than their house is worth and is paying $2,000/mo mortgage.

    • Tony says:

      I think it would be best if the government stopped trying to control the markets:

      http://freakonomics.blogs.nytimes.com/2009/11/30/more-money-more-fishing/

      • godlizard says:

        Agreed. For instance, by giving tax breaks for mortgage interest, the government effectively takes revenue directly away from rental property owners, and gives it to the banks in the form of motivated customers.

        And in an economic downturn, if the above described two individuals both experienced the same drop in income, the renter could move into a smaller place, but the homeowner (who is upside down on his mortgage) can’t sell his house — so the bank forecloses. The bank doesn’t consider their interest income they received during the life of the loan as an offset to their loss, it’s a straight “this is the book value of the loan, and this is our asset, which is worth less than the unpaid loan, therefore we have suffered this loss”. And then goes to the government, and the government covers the bank’s losses.

        Hmm, there’s a pattern here, isn’t there?

      • sraffa says:

        tony- You forgot to correct one thing in the freakonomics article. They say it’s a subsidy, which is ridiculous. It’s a tax deduction, since its just letting kirabatians keep more of their own money.

        By the way, this freakonomics article implies that lower taxes on labor would reduce labor hours. This is basically a backward bending supply curve, and it would imply that higher taxes would “encourage” more working. Just saying- be careful what you wish for.

  25. sraffa says:

    “That means it is the homeowner’s money to begin with and they just get to keep a little more of it instead of sending it to Washington”

    Let’s say the government wants to subsidize alternative energy. To this end, it exempts from capital gains taxes any investment in alternative energy. This is a subsidy, no? Or is it the “business’s money to begin with?” Your definition is incomplete and almost totally uninformative.

    “I’ve taken a quick look and will look more later, but I still stand behind my belief that the tax deduction is not a subsidy”

    This is ideology and blinding oneself to facts. It’s a simply definition- a tax is the opposite of a subsidy. Ask any economist, left or right.

    “TANF is one small portion of the welfare system as a whole. Just go to any inner city and most rural areas and you can see the facts for yourself. Lazy bums waiting on the government check. unwed pregnant women smoking cigarettes. Worthless idiots hanging out waiting for the disability check. They can lift a 40 ounce and a joint but the can’t lift a loaf of bread and bag groceries at the grocery store.”

    And I’m sure you asked all of them if they were on welfare right, not just anecdotes from people you saw on the street that you have no idea at all about their circumstances. Like I said, you need to look at facts. TANF is limited to 5 years. If you want to enumerate the programs you would like to eliminate, be my guest, but until then, you’re in a fact-free zone.

  26. sraffa says:

    “I am a farmer. I grow corn, soybeans, and raise cattle, and sheep.” I hope you don’t tax government subsidies, errr…, tax deductions. Shouldn’t recipients of farm subsidies need to take drug tests to check that they’re not on meth?

    “They farmers are going to plant the same amount every year. Good years mean a little more money in their pockets. Bumper crops spur more hiring, not prices. The cycles are so long to grow produce and grains that you can’t plan for more workers and higher prices.”

    Yes, but the productivity of farms and the number of farms is not fixed. Farm productivity rises every year, so the same land and labor hours can produce more and more food.

    And again, while caloric intake might be similar, this doesn’t mean that spending on food is constant. One can spend $1 a meal buying rice and have enough calories to live. But with food stamps, they may buy more vegatables, more meat, etc. which will mean more expenditure on food. Just look at any data series on food expenditures. They tend to rise slower than general expenditure, but nonetheless expenditures rise every year. It’s completely false to imply that food expenditure per person is fixed.

    • Tony says:

      I think the point is that farming isn’t driven by market demand like cars and other goods. Our productivity rises every year because technology improves every year. The number of acres available for farming IS fixed and with urban sprawl, the number of acres decreases every year. We can produce 10x more corn in one acre today than most farmers could produce in 10 acres in 1900.

      We also spend the smallest percentage of our income on food in the history of mankind. About 7% of our income today is spent on food. Compared to almost 25% in 1930. We spend a lot more these days on durable goods, which is where the market should be stimulated.

      • sraffa says:

        You are definitely right about agricultural productivity.

        “I think the point is that farming isn’t driven by market demand like cars and other goods.” All markets are driven by demand and supply. What if people started buying cheaper food. Would that affect the market for food? Obviously yes.

        Just look at farmer’s experience in the Great Depression. Obviously the market was affected by the plunge in demand.

        We do spend more on durables than food. But remember that your original proposal was that “spending money on food does not stimulate an economy” which is wrong. If we spend 100 billion dollars more on food, it clearly stimulates the economy. Say there’s a major crop failure in Canada and they start import a lot of wheat. Are you saying that will now stimulate the american economy? Of course it will.

        We should also stimulate durable goods purchases. Any suggestions? That was the point of cash for clunkers. I’m open to other ideas. But just saying there’s another option doesn’t mean that helping people have enough to eat can’t also help stimulate the economy.

      • Tony says:

        Where do you think that 100 billion comes from? The government printing press? It’s still taking money from taxpayers and giving it to non taxpayers. So yeah, those who get food stamps “stimulate the economy” but now the taxpayers who had their income redirected DON’T get to stimulate the economy. You’re just stirring the pot, not actually producing anything. Producing goods from raw materials is what the economy is built on. Farmers are already doing this. Spending more money on food isn’t going to make farmers grow food faster.

        Pretty easy to stimulate an economy: cut taxes, cut government spending. Reagan got it right:

        http://en.wikipedia.org/wiki/Reaganomics

  27. sraffa says:

    *don’t receive agricultural subsidies* err tax deductions

  28. sraffa says:

    “Had Cuomo let the private sector continue doing what it was doing (making sub-prime loans) without interference,”

    Wow, this is exactly what got us in this in the first place. So if we had had more disastrous right wing policies, we would have had a trerrible, slightly less bad crash earlier? We’re setting the bar pretty low here. Anything to blame Clinton I guess.

    How about no more subprime lending so we don’t need to have so many people on food stamps instead?

  29. sraffa says:

    dwight, let’s say we started giving working people below the poverty line that get government assistance tax credits instead of welfare checks. Let say we call it the “earned income tax credit.” Is that a subsidy, or a tax deduction?

  30. Tony says:

    I would be happy to switch to a national sales tax. It would exclude unprepared food just like it does now. That way those who spend the most (the wealthy) would be taxed the most with no way to skirt the system.

    Problem is, we would need to repeal the 16th amendment to make sure politicians aren’t reaching in both pockets.

    http://www.fairtax.org/

  31. sraffa says:

    Tony- those people still pay payroll and sales taxes, so it’s not a false choice. It just you dodging the question. Or is $1 in payroll taxes not a tax and $1 in income taxes is a tax?

    • Tony says:

      I’m pretty sure I said “They don’t pay income taxes.” Is my statement incorrect?

      And it is a false choice because THEY DON’T PAY INCOME TAXES. Are you going to exempt them from sales taxes with this TAX DEDUCTION THAT CAN’T BE APPLIED? Exempt them from payroll taxes?

      I try not to answer nonsensical questions, but it would be a tax deduction. Go read the dictionary.

      • Not the Mike You're Looking For says:

        Would you believe that the mortgage interest tax deduction was a subsidy if the Wall Street Journal called it that?

        “The mortgage-interest deduction for owner-occupied homes is estimated to cost the government $100 billion this year, making it the largest government subsidy for housing and one of the most expensive tax deductions.”

        http://online.wsj.com/article/SB123569898005989291.html

        There you go: It’s a deduction, not a credit, so only people who are already paying taxes get the benefit, yet the WSJ calls it a subsidy. Good enough for you?

      • Not the Mike You're Looking For says:

        Or the American Enterprise Institute?

        “Subsidies for home ownership–in the form of full deductibility of mortgage interest, lower mortgage borrowing rates derived from government guarantees for mortgage lenders like Fannie Mae and Freddie Mac, and deductibility of local real-estate taxes–have long benefited those who own homes at the expense of those who do not.”

        http://www.aei.org/article/100719

        Note again that the author is talking about deductions, not credits–so you have to pay taxes to be eligible.

        In case you’re not well-versed in the arcana of think tanks, the AEI is probably the best-known and most highly-regarded conservative think tank. Dick Cheney sits on its board of directors.

      • sraffa says:

        It’s earned income/ tax credit. It’s a tax credit on earned income, not an earned/ income tax/ credit.”

        Look at it this way- if I pay $500 in payroll taxes, and I get a $400 tax credit from the government, then you can see it as a tax deduction.

        As they pay taxes, this offsets their tax burden. And it’s a substitute for welfare programs, as it raises them over the poverty line.

        So why should some people getting tax deductions (EITC and the like) take drug tests, while others don’t?

  32. sraffa says:

    “Where do you think that 100 billion comes from? The government printing press?” Actually yes, since the Fed can buy the bonds the government issues, which is equivalent to the printing presses.

    “It’s still taking money from taxpayers and giving it to non taxpayers.” Everyone pays sales taxes and everyone who works pays payroll taxes. More mistakes, you really can crank them out.

    “So yeah, those who get food stamps “stimulate the economy” but now the taxpayers who had their income redirected DON’T get to stimulate the economy.” This is basically the Treasury View which has been long discredited. The government runs a deficit during recessions- it borrows money from banks who buy bonds instead of holding the money as excess reserves. Thus there is no reduction in demand from the deficit spending, while the recipients of food stamps spend the money which stimulates the economy.

    “Producing goods from raw materials is what the economy is built on.” Actually it’s mostly services. Food accounts for under 10% of the economy like you said. The number of people actually working is agriculture is less than 5%. Services are more than 60% of the economy, which is NOT producing goods from raw materials.

    “Pretty easy to stimulate an economy: cut taxes, cut government spending. Reagan got it right:”

    Reagan spent much more, and ran massive deficits. However, he was still responsible enough to sing budgets that raised taxes almost every year of his tenure:

    “The year 1988 appears to be the only year of the Reagan presidency, other than the first, in which taxes were not raised legislatively. Of course, previous tax increases remained in effect. According to a table in the 1990 budget, the net effect of all these tax increases was to raise taxes by $164 billion in 1992, or 2.6 percent of GDP. This is equivalent to almost $300 billion in today’s economy.”

    This is from an article by Bruce Bartlett, who is a Republican and advisor to Reagan and official in the Bush1 administration.

    http://www.nationalreview.com/nrof_bartlett/bartlett200310290853.asp

    Spending also was never cut- from the Gipper’s own mouth:

    “”Congress never cut spending by even one penny, ” Reagan complained in 1993.”

    It seems like the truth is the opposite of everything you say, tony…..

    • Tony says:

      LOL. I’m well aware the government buys their own bonds. Which is why the federal deficit is over $14 trillion. WHO DO YOU THINK WILL HAVE TO PAY OFF THAT DEBT? THE GOVERNMENT CANNOT PRINT MONEY FOREVER. IT WILL HAVE TO BE REPAID BY TAXPAYERS!!!

      Income taxes, payroll, and sales tax go to different budgets. Sales tax is kept by the states. And if you only buy food then you never pay sales tax either. You’re making the point that everyone pays taxes which is true, but it has nothing to do with this argument.

      You’re trying to push Roosevelt’s New Deal which was the worst economic policy in American history. http://www.cato.org/pub_display.php?pub_id=3357

      Are “service” people actually producing something? Can you measure a service? Hold it in your hand? Of course not. Service are needed in any economy, but they just stir the pot. People give money for a service, and servicemen turn and buy goods or more services.

      Reagan ran a deficit to win the Cold War in an arms race. And he succeeded in that too.

      “During Reagan’s tenure, income tax rates of the top personal tax bracket dropped from 70% to 28% in 7 years”

      Seems like it was a pretty good policy over all, one that we’ve gotten away from. Now look at the mess we are in again. Here’s some more:

      http://www.heritage.org/research/taxes/bg1414.cfm

      And I won’t be responding to anymore rhetoric you post. This conversation is boring me. It gets old trying to explain to blind people that the sky is indeed blue.

      • sraffa says:

        “WHO DO YOU THINK WILL HAVE TO PAY OFF THAT DEBT? THE GOVERNMENT CANNOT PRINT MONEY FOREVER. IT WILL HAVE TO BE REPAID BY TAXPAYERS!!!” Who created that debt? Most of the US debt today is from WW2 or Republican administrations.

        “Reagan ran a deficit to win the Cold War in an arms race.” Yes, and last time I checked, arms purchases were government spending. Wait, didn’t you just say that debt was bad? Guess where they come from…. deficits. Most of the current US debt was accumulated by Reagan, Bush 1, and Bush 2

        “Income taxes, payroll, and sales tax go to different budgets.” It doesn’t matter where the money goes, we were discussing whether people pay taxes. $1 in tax credits is one dollar in tax credits to the recipient.

        “And I won’t be responding to anymore rhetoric you post.” I believe you mean facts. Where did I use rhetoric?

        I understand wanting to flee the thread after your arguments got so thoroughly demolished, which is kinda the whole point of your last paragraph.

      • Not the Mike You're Looking For says:

        Tony, you’ve exempted food production from the law of supply and demand; dismissed 78 percent of GDP (from services) as unimportant; and contradicted conservative economists on the definition of a “subsidy.”

        I recommend that you read one of Greg Mankiw’s textbooks on economics. For a time he was the head of the Council of Economic Advisers for the GWB administration, so he’s not a liberal. You can find a copy for less than $5 (including shipping) here:

        http://www.abebooks.com/servlet/BookDetailsPL?bi=1467062333&searchurl=an%3Dmankiw%26sts%3Dt%26tn%3Dmacroeconomics%26x%3D0%26y%3D0

      • Not the Mike You're Looking For says:

        And I just noticed the unintended irony of Tony’s Cato link. The article is from March of 2001:

        “Proponents of additional government spending try to make the Reagan boom appear to be a bust because they fear that Reagan’s success will help President Bush build popular support for lower taxes, further deregulation, and reduced government spending.”

  33. Neil D says:

    Ah yes – the cheating problem. It is the bane of every social program. No matter how much you want to help, no one is ever as worthy as they need to be.

  34. Bob says:

    except you aren’t being given anything that belongs to others when you get a tax deduction.
    so what kind of drugs do you need to take to correlate the 2?

  35. sraffa says:

    Bob- It’s been pretty thoroughly shown in the above discussion. Ask the Wall Street Journal or any economist if you have a beef with it.

    Do you need another example? Let’s say Obama now says that no Democratic voter has to pay any taxes. What is the appropriate response: “Unfair subsidy” or “People keeping their hard-earned money”?

    Can I ask- where do you guys come from? Is there another blog that recommended this subject?

  36. Pingback: The Rich Strategically Defaulting and the Merits of Cramdown « Rortybomb

  37. Kelly says:

    You’re trying to compare apples to oranges…..the people getting the mortgage interest tax credit are contributing citizens….the people living on welfare….should be drug tested and should only be aloud to collect for so long….period. I am a single mother of 3. I was abandoned by my husband…I didn’t have a job…I collected welfare for 3 months until I found a job…while I’m not wealthy but I have rose to own my 250k house….invest in 401k….work 50 hours per week and send my kids to college….was I just lucky? Hell no…I work my ass off….I’m tired of hearing excuses for women who can pump these kids out but can’t take care of them. I don’t mind paying my taxes but everyone hates to see waste…..

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