Higher Taxes Won't Reduce the Deficit

Politicians claim we need to raise taxes to reduce the deficit, but history shows that higher taxes have always lead to even higher spending.

In the late 1980s, one of us, Richard Vedder, and Lowell Gallaway of Ohio University co-authored a often-cited research paper for the congressional Joint Economic Committee (known as the $1.58 study) that found that every new dollar of new taxes led to more than one dollar of new spending by Congress. Subsequent revisions of the study over the next decade found similar results.

We've updated the research. Using standard statistical analyses that introduce variables to control for business-cycle fluctuations, wars and inflation, we found that over the entire post World War II era through 2009 each dollar of new tax revenue was associated with $1.17 of new spending. Politicians spend the money as fast as it comes in—and a little bit more.

The only option left is to cut spending, but we already knew that, didn't we?

Obama vs. Pelosi

The battle is heating up.

Pelosi is bitching about how Obama is favoring the Senate, while Obama wants Pelosi to focus legislation that actually has a chance of passing.

Pelosi blames Obama for not pushing hard enough once House bills reach the Senate. I blame Pelosi for pushing bad bills to begin with.

Douchebag of the Week: Senator Richard Shelby (R-AL)

Richard Shelby, Senator from the great state of Alabama, is a flaming douchebag. He refuses to vote on Obama's presidential appointments until his home state receives billions of dollars in pork.

Senate Majority Leader Harry Reid, D-Nev., said Shelby's move is holding up about 70 appointments, including a critical top Defense Department position overseeing deployments to the war in Afghanistan.

Senate Republican Leader Mitch McConnell of Kentucky offered little defense, saying Thursday that he didn't know much about Shelby's concerns and that he would try to hash them out "sooner rather than later."

Senators frequently block individual appointments, but Shelby's blanket hold is unusual. His spokesman issued a statement about the holds Friday, citing concerns about a contract for an Air Force refueling tanker that could be built in Alabama and a new FBI explosives center that Shelby wants built there. Shelby argues the projects are critical national security priorities.

The value of the Air Force contract could reach $35 billion, plus $45 million for an FBI research facility in his home state.

Shelby argues the projects are critical for our national security. Democrats have shot back, claiming 'There are empty chairs at the Pentagon.'

Democrats are scrambling to not screw this up. Shelby's claims of fiscal conservativism leave him and the GOP wide open to justifiable criticism, exposing his intense hypocrisy, and expose him for the enormous douchebag that he is.

This Could Get Interesting

House Republicans are meeting with President Obama today to rip him the proverbial "new one," and it will all be televised, live.

BALTIMORE — It’s the rumble in Baltimore as House Republicans take on President Obama today.

Gathered for a retreat in the Renaissance Hotel overlooking the blue-collar city’s famous harbor and historic Fort McHenry, members of the conservative Republican House Conference say they are itching to quiz the president and present their policy ideas rather than listen to another lofty presidential address.

“House Republicans welcome any opportunity to present our better solutions,” said Representative Mike Pence of Indiana, the No. 3 House Republican and the organizer of the House retreat.

We'll see if that big talk means big ideas from House Republicans. I know there are some good ideas out there. Are you there Ron Paul?

Millionaires in Congress

A new report finds that of the 535 members of Congress, 237 of them are millionaires.

That’s 44 percent of the body – compared to about 1 percent of Americans overall.

CRP says California Republican Rep. Darrell Issa is the richest lawmaker on Capitol Hill, with a net worth estimated at about $251 million. Next in line: Rep. Jane Harman (D-Calif.), worth about $244.7 million; Sen. Herb Kohl (D-Wis.), worth about $214.5 million; Sen. Mark Warner (D-Va.), worth about $209.7 million; and Sen. John Kerry (D-Mass.), worth about $208.8 million.

I find it hopelessly ironic that the 5 4 of the 5 richest people in Congress are Democrats. I guess I shouldn't be surprised.

It's funny how the people most able to directly help the poor refuse to do so, and instead wish to pass the check to taxpayers. Hey Kerry, instead of supporting this draconian health reform, why not use a few thousand dollars and buy insurance for a poor family?

But that's not even the best part:

Some lawmakers have profited from investments in companies that have received federal bailouts; dozens of lawmakers are invested in Wells Fargo, Citigroup, Goldman Sachs and Bank of America.

I'm sorry, but HOW THE FUCK IS THIS LEGAL? This country is being bankrupted so our "representatives" can profit on their investments? This is torch and pitchfork stuff here.

This only reaffirms my belief that government debt is bad, and government involvement in the marketplace is worse.

[Politico via rastian77]