Here’s an idea: Let’s occupy and then redistribute D.C.
Let’s take the $3.6 trillion in spending that Obama wants in his latest budget and split it up equally between the 115 million households in the United States. The $31,304.35 income bump normal households would see wouldn’t quite bring the median American household income-- $50,054-- up to the level of those enjoyed by people who live on the D.C. metro area-- $86,680 -- but it would come close.
It would at least be better than the most recent idiocy coming out of Washington where they “taught” the rich a lesson by raising taxes on all working Americans by 2 percent… plus quite a bit more in hidden taxes.
Because suddenly, even liberal economists in the mainstream media are figuring out that, oops, maybe raising taxes wasn’t such a good idea.
Retail sales contracted in March for the second time in three months, a sign the American economy may have stumbled at the end of the first quarter.
Retail sales fell 0.4 percent during the month, the Commerce Department said on Friday. That was below analysts' expectations that sales would be flat.
The sales data supports the view that the U.S. economy continues to struggle and hasn't gained as much momentum has analysts believed just a few weeks ago.
"The miss in retail sales sends concerns about the impact of higher payroll taxes," Omer Esiner, a market analyst at Commonwealth Foreign Exchange told Reuters, likely emphasizing the words “higher… payroll… taxes” by speaking them verrrry slowly to a recent graduate of journalism school, who probably minored in gender studies either the hard way or the easy way.
“So it’s a tax scheme, huh? Who would have believed it?” I can hear the eager-beaver journalist say.
Washington’s remedy for the poor fourth quarter 2012 GDP, which posted a revised gain of about 0.4 percent, was to give D.C. even more of your money- starting in the first quarter of 2013. And so it began.
But if you think the economic slowdown now is related to the tax increase then, well you might be good at math, but you know nothing about Washington math and Washington journalism, both of which are the highest forms of the art of opinion.
Because wait, there more to the story. We haven’t heard from the government experts yet. These are experts, by the way, who mostly reside in about the Washington, D.C. and just coincidentally enjoy, with their friends and neighbors, a median household income of $86,680-- not $50,054.
Reuters is very quick to point out that the 2 percent cut in government spending- also known as Super Sequester Sandy- is also to blame for decline consumer spending, along with taxes, even though: 1) Sequester cuts haven’t really happened; 2) They really aren’t cuts; and 4) <----- I’m using Washington math there, just as an example (I’m not areal journalist so technically I’m not qualified to use D.C. math) - Super Sequester Sandy doesn’t come close to the impact payroll and other taxes have had on the economy this year- and years to come.
“Fiscal policy tightened further in March when the federal government began across-the-board spending cuts known in Washington as the sequester,” reports Reuters, “part of Washington's efforts to shrink the budget deficit. Non-partisan researchers working for the U.S. Congress estimate Washington's austerity drive will subtract about 1.5 percentage points from economic growth this year.”
Let me explain the problem with the figures from those “non-partisan researchers working for the U.S. Congress.”
Since federal spending as proposed by Obama will make up roughly 25 percent of GDP, there is no mathematical way that a 2 percent cut in federal spending could reduce GDP by “1.5 percentage points” this year.
Government economists and journalists need to pay attention because I’m going to do some math here: 2 percent of 25 percent of GDP equals… 0.5 percent of GDP.
And here’s the other problem that “non-partisan researchers working for the U.S. Congress” have with that math: Only about half the cuts happen this year. Even if you add a type of multiplier effect, there’s no way that government spending cuts bring down GDP growth by “1.5 percentage points” this year.
Increased taxes might, but not tiny cuts in government spending.
I suspect that the real math problem that those “non-partisan researchers” have is that their friends and their neighbors, along with themselves, have a median annual income of $86,680 per year.
And the solution to that math problem is to occupy and redistribute D.C.