First of all, you dumba$$, the US gov't deficit and the US economy are two seperate entities. If US Gov't raises it debt ceiling then it is betting on the ecomomy (which is GDP of US) raising or even passing the debt in future..... Hence, you will here President Obama speaking of stimuliting the economy with this additional money...
"In theory, a payroll tax cut could please both antitax Republicans and Democrats worried that the lower and middle classes are being squeezed by the recession. But the idea may have a rocky road in Congress, especially if lawmakers are looking to use it as part of a compromise to raise the debt ceiling. Further cutting the payroll tax—which funds Social Security—
would raise questions among budget hawks worried about the cost to the deficit."
Momentum Grows for Payroll Tax Cut - US News and World Report
The plan -- which proposes slashing $4 trillion off the nation's debt over the next 10 years --
recommends that lawmakers consider a so-called payroll tax holiday as an economic stimulus measure.
The "holiday" would be one-sided, meaning it would apply to either employees or employers, but the report is not clear on which. Each currently pay about 6.2% of a worker's salary, up to the first $106,800 of income, to fund Social Security.
While most measures in the debt commission's plan seek to reduce the nation's staggering deficit, cutting payroll taxes, at least for part of fiscal year 2011,
would actually cost the government between $50 billion and $100 billion in lost revenue, the report said.
The trust funds of Social Security and Medicare, which are normally supported by the payroll tax, would instead be reimbursed from general revenues in 2011.
Still, the debt commission said, it would be worthwhile because a payroll tax holiday
"would result in significant short-term economic growth." (Fantastic
)
Earlier this year, the nonpartisan Congressional Budget Office estimated that eliminating payroll taxes could be roughly two to four times more effective in spurring economic activity than a reduction in income taxes.
The tax cut both parties should love -- but don't
While it would seem like a win for Democrats, who generally support more stimulus, and Republicans, who advocate for more tax cuts, the proposal has garnered very little support from most Washington lawmakers.
Democrats appear to be more concerned about weakening the financial support behind Social Security, and Republicans are more focused on extending the Bush-era tax cuts for top wage earners.
Sen. Judd Gregg, a Republican from New Hampshire who sits on the debt commission, said he plans to vote in favor of the overall plan, but he disagrees with the payroll tax recommendation in particular.
"The economy will recover if we don't raise taxes, but an additional tax cut may not help," said Gregg, who argues the first round of stimulus rebate checks, totaling about $90 billion in 2008, failed to significantly boost the economy.
Some leading economists are also skeptical.
At a time when consumers are still cutting back their spending and revving up their savings instead, some argue a payroll tax holiday would be ineffective as a stimulus move. Workers may just put the extra dollars away as an investment or use them to pay down their existing debts.
"In terms of addressing long term needs, I don't think anybody thinks America's problem is we had too little consumption," Nobel Prize-winning economist Joseph Stiglitz said Wednesday. "This is really an instrument for increasing consumption, and so I would prefer, if you're going to give some tax cuts, to focus it, one way or another, on investment that produces bang for the buck." (My sentiments exactly)
Slash the deficit! But give a payroll tax holiday - Dec. 1, 2010
Again your one liner reviews are so full of holes
Yes, depending on what product are you speaking off.... If you are talking about paper clips then no, but talking about Cars, computers or aircrafts, yes because the economic scales of computerization and robotics outdues any human labor...
Thanks..
"But what chance is there that workers will permit employers to reap the benefits of a lower payroll tax rate? In my opinion, none. Workers will insist that they get all the benefits in the form of higher take-home pay. Consequently,
there will be no reduction in labor costs for employers and no reason why this measure will reduce unemployment.
Moreover, it's clear from looking at labor markets that the problem for employers isn't that labor costs are rising excessively,
but rather that there is no demand for their output. Under such conditions, a small cut to labor costs, such as might result from lowering the payroll tax, is very unlikely to do much of anything to expand employment."
Don't Cut The Payroll Tax - Forbes.com
Debating with you is simply a joke, simply getting news sources from good sites already support what I said earlier. With regards to manufacturing I already mentioned in post #103 that
"No doubt some really high tech industries will see the benefit but I hardly doubt any US worker will work for 134 USD per month assembling Ipads. Doesn't the US unemployment benefit pay more then this already?".
If we start talking about computer manufacturing and other areas again we will loop back to the Supply Chain bit I raised earlier (With supporting references) that you so obviously breezed over.
Debating with you was an amusement at first but now it’s getting boring. Even your arguments about economics of scale and robotics makes no sense in most industries considering how cheap human labour is around the world and economies of scale are designed primarily on products that are meant for the mass consumer market. (meaning CHEAP)
This is my last post to you dipstick, normally I will respect the person I debate with but for you I make an exception since you’re so full of yourself.
Good luck trying to reduce that deficit by cutting taxes
